Assessment of Hulu’s Marketing Strategies
December 6th 2023
MKTG 385 - Consumer Behavior
Dr. Gizem Atav
Group 4
Jordan Braverman, Joe Horowitz, Ethan Johnston, John Shields, and Andrew Skalny
Introduction
In the ever-evolving landscape of streaming services, the ability to stand out from the
crowd is necessary for survival. In this landscape, content is king and user experience reigns
supreme. What started as a joint venture between News Corporation, NBC Universal, and
Providence Equity Partners in 2006, Hulu has carved itself a place amongst the competition by
offering a diverse array of TV shows, movies, and exclusive content to a broad audience.
However, as the streaming landscape continues to evolve at a rapid pace, Hulu has begun to lag
behind the competition. It becomes imperative for Hulu to reassess its strategy to stay
competitive. Our team identified five solutions: improving the ad experience, adopting trending
shows, personalized user experience, more flexible subscription plans, and partnerships with
influencers, for Hulu to implement which will address the major shortcomings we identified. in
order for it to not only stay competitive but become the dominant player it once was.
Market Analysis
As Hulu evolved into a prominent player in the streaming service industry, it was
acquired by The Walt Disney Company in 2007. Hulu caters primarily to millennials and Gen Z,
offering a diverse range of shows and movies for direct streaming. Hulu is only offered in the
US, Puerto Rico, and some parts of Japan. Hulu’s main customer base comprises individuals
aged 25-34, with a slight majority being female (52%). The service satisfies their need for
entertainment and convenience, offering an extensive library with competitive prices. Positive
conditions for Hulu are driven by the rise in streaming, bundled pricing, and the convenience of
having a variety of movies and TV shows on one platform. Economic, technological, and social
trends favoring streaming services contribute to a conducive environment. Hulu faces strong
competition from other streaming services, primarily Netflix, Amazon Prime Video, HBO Max,
Disney+, YouTube TV, and Crunchyroll, each with unique strengths and weaknesses that shape
the streaming industry.
The most popular shows on Hulu, as of December 2nd, 2023, include Bob’s Burgers, The
Kardashians, The Masked Singer, Hell’s Kitchen, and Bachelor in Paradise. The current most
popular movies available on Hulu include John Wick 4, The Intern, Elf, and Kandahar
1
(FlixPatrol, 2023). According to medium.com, the genre breakdown of Hulu’s shows and
movies is 38% drama, 35% comedy, 19% action, 17% adventure, 15% crime, 13% animation,
13% documentaries, 11% romance, and 10% thriller. Other genres, such as horror, family,
sports, and musicals were all below 10% (Medium.com, 2021). Interestingly enough, 0% were
Westerns, which makes sense due to them being much more popular among the older generation,
who isn’t included in the target market. Also note that in this breakdown many shows were
included among various genres. According to Statistica, there are currently 48.5 million active
paid users of Hulu in the US, of which only 4.5 million are subscribed to Hulu Live. However,
Netflix currently has 247.15 million users worldwide with an annual revenue of $31.6 billion and
Amazon Prime currently has 200 million users worldwide (160 million in the US alone).
Disney+ currently has 150.2 million users worldwide, however, this is a dropoff from a year ago
when it peaked at 164.2 million users. HBO Max on the other hand has 97 million subscribers
(Statistica, 2023) and Crunchyroll has roughly 5 million subscribers (EarthWeb, 2023).
However, it is important to keep in mind that many of these streaming services are available in
many more countries than Hulu is.
Current Strategy Analysis
Hulu's current strategic approach is characterized by a multifaceted marketing strategy
that caters to different segments. Bundling is a key strategy that involves partnerships with other
prominent services, such as Spotify, Disney+, and ESPN+, offering bundled discounts that target
a wide range of customer segments, including college-aged students. These collaborations
provide Hulu users with access to a comprehensive entertainment package, enhancing the
platform’s value proposition.
In addition to bundling, Hulu’s advertising efforts showcase a diverse and expansive
reach across several mediums. Traditional advertising, such as TV ads, ensures visibility among
a broad demographic. Meanwhile, targeted campaigns on social media platforms such as
Facebook, TikTok, Snapchat, and Twitter speak directly to different age groups and user
preferences. The inclusion of Hulu buttons on remote controls, a minor yet impactful detail,
2
positions the streaming service at the forefront of accessible options for users. This strategic
placement goes beyond conventional advertising, seamlessly integrating Hulu into the user
experience, making it effortlessly available for a large audience. Additionally, Hulu strategically
focuses on Search Engine Optimization (SEO) and paid search efforts, ensuring that the platform
remains visible and accessible in the digital landscape. These efforts, combined with prominent
placement on popular streaming devices like Roku, amplify Hulu's exposure, presenting it as a
convenient and intuitive choice in the minds of potential subscribers.
The synergy of Hulu's content and exposure strategies is particularly evident in its
emphasis on exclusive content and partnerships. The platform strategically collaborates with
various content creators and leverages exclusive shows, including Hulu Originals, to attract and
retain subscribers. This dual approach not only differentiates Hulu in terms of content but also
reinforces the platform's commitment to offering unique and compelling entertainment options.
The exclusivity associated with Hulu Originals contributes to brand identity, enhancing the
platform's appeal as a go-to destination for premium and distinctive content.
Furthermore, Hulu's exposure strategy extends to targeted advertising on social media
platforms, aligning with the preferences and habits of different demographic segments. While
Facebook caters to a more diverse and mature audience, TikTok and Snapchat target younger,
trend-centric users. This diversified approach reflects a strong understanding of consumer
behavior on various platforms and highlights Hulu's commitment to reaching audiences where
they are most engaged. The platform's presence across multiple social media channels not only
broadens its reach but also allows for tailored messaging, reinforcing Hulu's versatility and
adaptability in its marketing tactics.
In terms of pricing, Hulu adopts a flexible strategy with various subscription tiers,
accommodating different budget constraints and preferences. This tiered pricing model ensures
that Hulu remains competitive while offering options that cater to a wide range of users. The
introduction of Hulu Live Sports, coupled with endorsements like Damian Lillard promoting the
service, enhances its appeal among sports enthusiasts and cultivates a deeper connection between
the brand and its audience.
3
In summary, Hulu's multifaceted marketing strategy is a well-orchestrated symphony of
bundling, advertising, content curation, and exposure optimization. By intricately weaving these
elements together, Hulu not only ensures a robust market presence but also cultivates a brand
identity that resonates with a diverse audience. As the streaming landscape continues to evolve,
Hulu's strategic capability lies not only in adapting to these changes but also in proactively
shaping consumer perceptions and preferences, positioning itself as a dynamic player in the ever-
expanding streaming market.
Focus Group
To gain a better understanding of the perception of streaming services like Hulu, we
conducted two focus groups to shed light on how Hulu can improve in the streaming services
market segment. Our goals were to find out what Hulu does well and should keep doing, the
underlying issues that are causing Hulu to phase out of popularity for Gen Z, the perception of
the brand compared to its competitors, and the factors that are preventing users from switching or
continuing to use Hulu.
The first and biggest discovery from conducting these focus groups was how Hulu was
choosing to advertise on its platform and the perception of these advertisements. Participants
across both focus groups expressed dissatisfaction with Hulu’s advertising model, mentioning
that the repetitive and intrusive ads are a significant drawback to using Hulu. Oftentimes, the
same adverts are shown over and over during the same program and would interrupt the flow of
the content being shown. With how prevalent the ads are on Hulu, especially when compared to
ad-free platforms like Netflix, was a recurring theme that impacted the overall viewing
experience. Beyond the excessive advertisements, participants also provided insights into the
variety of content that is available on Hulu. While Hulu was praised for its variety of shows and
movies, participants felt that the selection was not diverse enough to appeal to a broader
audience. Hulu’s content appeared to be tailored towards middle-aged adult demographics and
less towards Gen Z and college students.
4
Within the streaming market, Hulu faces challenges when compared to competitors like
Netflix, as participants noted that Hulu has a lack of standout exclusive shows or movies. With
The Handmaid’s Tale being uncovered as the only exception, Hulu lacks the trendy and
exclusive content that makes services like Netflix thrive with shows like Stranger Things. The
discussions extended into how Hulu is choosing to advertise and promote, where participants
talked about how Hulu’s promotions, for example, their live sports offerings, are not connecting
with audiences who find them relevant.
In addition, Hulu’s advertising strategies were compared unfavorably to Netflix's, with
suggestions that Netflix’s justification of its price is backed by its content while Hulu has to rely
on price bundles and cuts. This conversation transitioned into talking about the subscription
prices and durations of Hulu, where shorter subscription durations were preferred for platforms
with high show rotations like Hulu. It was found that the 3-month subscription appeared to be the
highest perceived value duration for Hulu, as the participants’ decision to continue or cancel
their subscription could be determined within that time frame.
Finally, we had participants talk about their perceptions of Hulu’s identity. A central
theme that emerged was that Hulu has no strong identity or personality that differentiates itself
from its competitors. With platforms like Netflix focusing on a large scope of original content,
Disney+ focusing on family-friendly content, and HBO Max specializing in premium and high-
quality content, Hulu maintains a general audience without a specific appeal.
Overall, the focus groups provided a comprehensive overview of the factors influencing
Hulu’s perception, ranging from their advertising efforts and content to their positioning and user
preferences. Using the key factors identified, we can formulate a roadmap for Hulu going
forward that will allow it to meet the expectations of its target audience.
Strategic Strengths and Weaknesses
Hulu, like any other streaming service, has a multitude of strengths alongside its
weaknesses. After our initial review of the streaming services, we highlighted various strengths
5
Hulu has to offer such as their large content selection, bundling price plans, various subscription
plans, and live TV options. Furthermore, our opening assessment identified many weaknesses in
Hulu such as the overwhelming number of ads, lack of international availability, content quality,
and requirements to stream. After conducting further market research as well as multiple focus
groups, we recognized that many of the strengths remained consistent with our initial findings,
however, the weaknesses we identified were not on par with the feelings many users had towards
the streaming service.
The weaknesses we discovered through our primary and secondary research indicated
that our team was not fully aware of how much ads play a role in the negative perception of Hulu
(Appendix 2, Focus group 1). In addition, our preliminary assumption that live TV, specifically
sporting events, was a huge perk to the streaming service, it turns out that accessing this feature
is a challenge for many and creates an unfavorable view of Hulu’s advertising.
Many of these weaknesses can be attributed to various consumer behavior concepts that
influence a user's perception of Hulu. In regard to a user's long-term memory, many people have
a script of what to anticipate while viewing a show or movie. When this script does not account
for potential ads disrupting their entertainment, it often results in frustration/irritation, leading to
dissatisfaction with the platform they are streaming from. Furthermore, if an ad's length or
content differs from what a user expects based on their schema, it leads to a negative perception.
Positive punishment is also applicable to finding the root of these weaknesses. When ads are
introduced to a streaming service, it will decrease the likelihood of a user coming back to the
same platform for more content. This concept also becomes relevant when users experience
frustration upon realizing that cable is essential for streaming sporting events, a crucial detail
omitted in Hulu's advertisements.
Recommendations
Based on the insights gathered from the focus group discussions, our group has identified
several practical recommendations that Hulu could utilize to strengthen its position in the
streaming market and improve its user experience. Addressing the overwhelming amount of ads
6
was deemed to be a priority. Many shows and movies were not created with ads in mind, so the
abrupt placement of commercials can diminish the narrative continuity, and overall viewing
experience. To address this issue, Hulu could consider implementing more strategic ad
placements, ensuring that interruptions align with natural breaks in the content. By doing this, we
believe that the reduction in ads would increase subscriptions and improve revenue long-term.
To compete effectively, especially with the rising HBO Max, enhancing Hulu’s repertoire
of shows primarily, as opposed to movies, is another key solution. Hulu already bolsters an
impressive catalog of content in terms of quantity. Many of its catalog is also quality content;
however, it often does not offer trending shows. Many of the participants expressed that they
value a show’s popularity amongst their peers very highly. The participants explained that they
will see clips of shows on TikTok which will make them interested in purchasing a subscription
to a streaming service. This is why in both focus groups, HBO Max was seen as a rising star as it
invests a lot into adopting trending shows into its catalog. Conducting market research on what
shows would be popular amongst Generation Z, such as Euphoria and Suits, would make Hulu
more competitive rather than simply adding as many shows and movies as possible. Another
solution we came up with was to introduce a way to follow friends on Hulu, similar to how
Spotify introduced this to allow music sharing. Similarly, on Hulu, you would now be able to see
what movies and shows your friends are watching as well as being able to specifically
recommend certain movies or shows to others. Along with this feature, we would also introduce
collaborative watching, similar to what Netflix does with its “Netflix parties”. In one of our
focus groups, it was said that they tend to watch shows when lots of their friends are talking
about it. Essentially, this would help generate buzz about various shows on Hulu and then
ultimately the Hulu brand as a whole. This also plays into the sense of belonging from Maslow’s
Hierarchy of Needs, which is the need to feel like part of a group and a sense of belonging.
Streaming services such as Disney + and Crunchy Roll have well-defined audiences;
however, Hulu caters to a more general audience. We don’t suggest Hulu should specialize in a
particular audience, but personalizing the user experience across all audiences is important.
Diversifying content to appeal to a broader audience, along with creating a unique brand identity
could set Hulu apart. Hulu prides itself on being “the best value for your money.” Taking
advantage of American psychologist Robert B. Cialdini’s commitment and consistency tactic
7
could be leveraged in order to increase subscriptions. This would be done by offering free trials
and using positive labels to reinforce the subscriber’s self-identity. For example, after signing up
for a free trial, we would acknowledge them as “smart viewers” or “entertainment enthusiasts”
who appreciate quality content. In future messages, we would attach these labels as consistent
with purchasing a Hulu subscription because of its quality, affordable content (Horowicz, 2023).
Lastly, to tackle the issue of confusing subscription plans, we suggest changing the layout
of choosing a plan to make it more condensed and customizable. As of right now, Hulu lists all
the numerous options for plans, bundles, and add ons all together, which can be very stressful if
you don’t go into it knowing what you want to subscribe to. Instead, we recommend changing
the layout, so that it asks you a number of questions, starting off with which basic plan you want,
then if you would like to add any streaming services to the bundle, emphasizing how you can
save money through bundling if you already planned on using the other platforms. Then, there
will be a question asking from which platforms that you chose that you would like to pay extra
for no ads. As you go through the questions, the total monthly price will adjust, just as if you
were ordering food at a restaurant off of a kiosk. Lastly, we propose adding a rental option to
movies or shows that are not typically available for non-Hulu premium users, similar to what
Amazon Prime has done. This in turn, will help increase profit and reduce the stress of signing
up for a Hulu subscription plan.
Appendix 1: Outline of Focus Group
In the two focus groups, we sought to identify the attitudes that the average college
student has about Hulu and the competition. The demographic was chosen as they comprise a
large portion of Hulu’s audience and are aware of the streaming service market. In preparation
for the focus groups, the moderator came up with a few topics to address but did not create many
specific questions. Among many of the goals, uncovering the latent motivations behind each
participant was prioritized. Opting to ask questions relevant to the conversation. The moderator
began each group with a very open-ended question: “If you were not here right now, what would
you be doing in your free time?” The purpose of this question was to primarily gauge the most
popular mediums of entertainment, but also create a relaxed environment by having participants
8
talk about their interests. The moderator then addressed those who did not mention watching TV
and movies and asked why they preferred their choice of entertainment medium in particular.
This was asked in hopes of uncovering anything Hulu could incorporate to make themselves
more attractive to this audience.
The moderator felt it was important not to mention the purpose of the focus group, Hulu,
until near the end of each session. This was done as he wanted the honest opinions of each
participant, without the bias of simply providing answers. Even the topic of streaming services
was not addressed directly and the moderator attempted to bring it up organically in casual
conversation with the participants as if he didn’t mean for it to become the main topic of the
conversation. As the topic of streaming services was discussed, the moderator tried to address all
relevant services equally and then focus on Hulu. When it came time to reveal the purpose of the
focus group, the moderator asked the participants what Hulu's competitive advantage and
shortcomings were. Much of this information had already been gathered earlier on the focus
group but the moderator wanted to see how the participant’s answers would differ when they
knew the purpose of the focus group.
Appendix 2: Transcript of Focus Group
Focus Group 1:
Joe: Why do you think Netflix is one of the better streaming services?
Sara: Netflix was one of the first streaming services I used so I knew it well, and they also do not
have ads like some other streaming services do.
Joe: What in particular would urge you to subscribe to a specific service?
Sara: Bundles or student deals are appealing. Sometimes popular shows are enough to get me to
subscribe, so the content is a factor.
Marlena: Bundles and deals are always good, especially for our age group. Trending content or
fear of missing out as well.
Joe: Do you see a lot of ads for Hulu and Netflix on other services or social media?
9
Evan: I used to see a lot of ads for Hulu with famous athletes in them but those are not as
common anymore so I do not hear about it as much now.
Joe: What is your perception of Hulu? What could they do better and what do they do well?
Antonio: They advertise on various platforms so you always hear about it.
Evan: Shorter shows didn’t used to have ads so that was always nice. The longer shows do have
ads though which I did not like as much.
Marlena: They make good Hulu originals. I do absolutely despise the amount of ads that have
been added to Hulu. They used to have a few ads every now and then but now it is like every two
minutes there is a new ad.
Sara: When I had Hulu I was in the middle of a show but then they took it off Hulu so I never
had the chance to finish it which I did not like. I also think when other services do not have ads
they become more appealing, Hulu does have a lot of ads which I am not a fan of.
Focus Group 2:
Isaac: The appeal of Disney is that there’s such a large catalog of movies from like the 90s to the
2000s. But if you’ve already seen it then the inclination is, at least for me, a less exciting
prospect than something new.
Joe: Okay. So they have a large catalog as is but they haven’t done much to really expand it, so
once you kind of have your fill…
Isaac: I mentioned like my parents got Hulu for a specific show
Joe: Yeah
10
Isaac: And they let it die, they let the subscription end. That’s the only kind of person I can see
really…like I don’t know if I could go up to someone and be like “You look like a Hulu user”
Like your character traits are Hulu
Joe: Yeah- it’s just, yeah
Isaac: I can do that with other streaming services but not Hulu
Joe: What streaming services could you do that for
Isaac: HBO Max
Joe: What kind of person would that be?
Isaac: If you like really high end television
Appendix 3: Additional Material
● ChatGPT: ChatGPT was used to help summarize the notes that were taken from each of
the focus groups conducted.
● In summary, the focus groups highlighted a range of issues impacting Hulu's perception,
including advertising, content variety, and competitive positioning. Improving these
aspects could help Hulu better resonate with younger audiences and regain its popularity
in the streaming services market segment.
Visuals and Graphs
Figure 1: Gen Z top video streaming apps by weekly time spent in hours (Statista, 2023)
11
Figure 2: Gen Z use SVOD/vMVPD services (Statista, 2022)
References (In-Text and APA):
- Ceci, L. (2023, April 18). U.S. gen Z top video apps by time spent 2023. Statista.
https://www.statista.com/statistics/1367609/top-video-streaming-apps-us-tim
- Cialdini, R. B. (2009). Influence : the psychology of persuasion (EPub edition.). Collins.
12
- Crunchyroll users: How many subscribers does it have in 2023? (n.d.).
https://earthweb.com/crunchyroll-users/
- Group, P. S. (2021, June 13). Top 10 popular genres the streamers love. Medium.
https://project-s-5together.medium.com/top-10-popular-genres-the-streamers-love-
cbe49dcd6526
- Horowitz, J.(2023, November 6). Chapter 3 COMMITMENT AND CONSISTENCY
Reflection Paper
- Laura Ceci, & 18, A. (2023a, April 18). U.S. gen Z top video apps by time spent 2023.
Statista. https://www.statista.com/statistics/1367609/top-video-streaming-apps-us-time-
spent/
- Stoll, J. (2023a, January 10). Gen Z teens using SVOD/VMVPD services 2022. Statista.
https://www.statista.com/statistics/1358332/gen-z-use-svod-vmvpd-services-us/
- Stoll, J. (2023, January 10). Gen Z teens using SVOD/VMVPD services 2022. Statista.
https://www.statista.com/statistics/1358332/gen-z-use-svod-vmvpd-services-us/
- Stoll, J. (2023, November 9). Global number of disney+ subscribers 2023. Statista.
https://www.statista.com/statistics/1095372/disney-plus-number-of-subscribers-us/
- Stoll, J. (n.d.). Topic: Hulu. Statista.
https://www.statista.com/topics/4262/hulu/#topicOverview
- Stoll, J. (n.d.-b). Topic: MAX. Statista. https://www.statista.com/topics/4291/hbo/
- Stoll, J. (n.d.-b). Topic: Netflix. Statista. https://www.statista.com/topics/842/netflix/
- Topic: Amazon prime. Statista. (n.d.). https://www.statista.com/topics/4076/amazon-
prime/
- Top 10 on hulu in the United States on December 2, 2023 • flixpatrol. FlixPatrol. (n.d.).
https://flixpatrol.com/top10/hulu/united-states/
13
