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FIVE SMART TACTICS for OTT SUCCESS: Launch and Build Your Internet TV Brand

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FIVE SMART TACTICS for OTT SUCCESS: Launch and Build Your Internet TV Brand FIVE SMART TACTICS FOR OTT SUCCESS: Launch and Build Your Internet TV Brand ® FIVE SMART TACTICS FOR OTT SUCCESS The OTT video market is still nascent Diving deep into the highly competitive OTT and can seem complex and competitive. landscape without the right planning risks But it is also the largest global media wasting time and money. This whitepaper opportunity in decades, so taking a wait- outlines five smart tactics that will give and-see approach is not a viable option brand owners the confidence and authority for content brands. Traditional broadcast to prepare a successful OTT offering: and cable have proven that TV is the most influential medium for building brands and 1. Clearly define a unique content strategy. driving commerce. Today, OTT technologies 2. Build toward maximum business model are delivering the power of TV with the agility. agility and scale of the global internet. From entertainment studios with compelling 3. Design a distribution roadmap across platforms and screen sizes. films for a targeted audience; to a radio broadcast station with a stable of digital 4. Adapt TV marketing tactics to find, talent; to a regional newsroom looking to nurture, and build your OTT audience. launch a mobile-first video destination, this new era of video offers a twofold promise. 5. Design, launch and refine your video First, media companies can extend existing offering and technology solution in a content to new audiences; and second, single, iterative effort. they can deepen audience engagement with new content and video experiences. 2:17 11:19 ©2016 Brightcove, Inc. All Rights Reserved. 2 The OTT Era of Television RealNetworks released one of the first its ad-supported business model5. In 2011, streaming platforms in 19971. A decade later, Amazon rebranded its streaming offer as in 2008, Netflix announced Watch Instantly Amazon Instant Video. Since then, they have and launched the service with about 1,000 bundled tens of thousands of titles into the titles2. Soon, the rapid growth of iTunes and Amazon Prime subscription offer, creating Netflix made it clear that a successful video a juggernaut in the subscription video-on- service could be delivered ‘over-the-top’ of demand market6. the public internet, rather than through the Today, there are hundreds of mass market expensive, closed networks of broadcasters, and special interest OTT services in all telecom and satellite providers and cable categories. Parks Associates tracked 33 OTT operators. service launches in 2015 alone. In addition Today, OTT innovation is powering to major launches like HBO Now, SlingTV the third era of TV. Video platform advances, and Go90, niche services like VidAngel adaptive formats, delivery network (family-friendly versions of movies and TV) enhancements, connected streaming devices, and XiveTV (high-quality documentaries) and monetization technology have brought leveraged clever programming strategies to IP video closer to its explosive potential, both gain beachheads in OTT. as a consumer experience and as a business OTT service usage has increased as well. model. By the end of 2015, 58% of U.S. broadband Prescient media brands have been investing households used at least one OTT video in OTT for well over a decade. MLB.tv service on a monthly basis. More than 25% launched in the spring of 2003, offering used two or more OTT services monthly. a full season of streaming for $79.95 and While definitive usage numbers for each signing up over 100,000 subscribers3. In the service do not exist, market research United Kingdom, the BBC’s iPlayer launched provides some insight into take rates7. in December of 20074. Hulu followed suit in 2008, differentiating itself from Netflix by ©2016 Brightcove, Inc. All Rights Reserved. 3 A recent survey conducted by Altman, Vilandrie & Company details the percentage of respondents who use the major services on a weekly basis. PERCENTAGE OF RESPONDENTS WATCHING EACH SERVICE ON A WEEKLY BASIS: Netflix 36% (streaming only) My cable TV provider’s 13% online video service Amazon Instant Video 11% Hulu Plus 11% HBO Go 7% Online premium sports package 6% (MLB.TV, NFL Mobile) HBO Now 6% iTunes 4% CBS All Access 4% Vudu 3% Google Play 3% Sling TV 3% Altman, Vilandrie & Co online survey of 3,461 respondents. Percentage of respondents watching that service on a weekly basis. ©2016 Brightcove, Inc. All Rights Reserved. 4 A Crowded Space: Is There a Bullish Case? Given the potential for OTT, it is not surprising to find a flurry of activity in the market. The OTT market is expected to generate an estimated consumer paid revenue of $15.6 billion globally through 2018. Yet, this represents just 4% of worldwide pay TV revenue, suggesting plenty of room for growth9. Ad-based revenue for OTT services will also grow. Magna Global tracked a 38% YOY increase in 2015 global digital video ad spend to $15.4 billion10. These factors contribute to the positive business case for launching an OTT service. However, it is clear that diligent execution against a strong plan is also critical. You can increase your odds of carving out a successful position in the OTT market by implementing these five tactics: 1 Clearly define a unique 4 Adapt TV marketing tactics content strategy. to find, nurture, and build your OTT audience. 2 Build toward maximum business model agility. 5 Design, launch and refine your video offering and 3 Design a distribution technology solution in a roadmap across platforms single, iterative effort. and screen sizes. Let’s walk through each one. ©2016 Brightcove, Inc. All Rights Reserved. 5 1: CLEARLY DEFINE A UNIQUE CONTENT STRATEGY Great content makes the medium of video even more powerful. Thus, it is essential to have a focused, compelling programming strategy as the foundation for an OTT launch. Here are some questions to consider: While some shows may broaden their appeal and grow a diversified following over time, • Which genre(s) of content others can find success as coveted niche do you plan to offer? offerings. This speaks to a key advantage • Describe your target audience of OTT over broadcast TV. It is possible, in detail. When and why do or perhaps necessary, for your content to they watch your videos? appeal more deeply to a narrower audience • How much content will you offer? than is economically viable in the traditional How frequently will it be refreshed? TV model. • What is your budget? What is your Also, note that your OTT content strategy targeted production value? does not need to be constrained to a linear • Will you offer a catalog of licensed schedule or a single device. Indeed, one shows? Originals? Will you offer live compelling aspect of OTT is that your and/or video-on-demand content? content strategy may provide opportunities to attract audiences across two or three A hallmark of the pay TV era was the diverse viewing behaviors. For example, dramatic increase in the number of channels if you have a catalog of dramas worthy of and genres that could appeal more deeply binge-viewing on a big screen TV, your to smaller audiences. Digital video has OTT service might also offer viewers the amplified that trend. Today, content creators opportunity to snack on short-form mobile are producing shows of all stripes, each videos in a promotional run-up to a new one with a creative vision that appeals to a release. specific audience. ©2016 Brightcove, Inc. All Rights Reserved. 6 Executing Your Content Strategy CASE EXAMPLE: Capturing and retaining audience engagement is no small feat. Here are three tips: How Acorn TV Leveraged a 1. NURTURE A HEALTHY PROGRAMMING Focused Content Strategy. LIFECYCLE. Utilize “tent pole content” (i.e. compelling, Brightcove customer RLJ high-production value content that will appeal Entertainment is a premier to mass audiences) as audience growth driver; seasonal shows to build momentum; and more independent entertainment studio frequently produced, everyday content to offering niche SVOD channels, maintain relevance with fickle attention spans. including Acorn TV. From its launch in 2011, Acorn TV has been laser 2. ESTABLISH GOOD PRODUCTION HABITS. focused on viewers that love British Get good at multi-purposing and versioning TV mysteries and dramas, curating of content. Whether this pertains to content rights or original productions, videos of some of the most popular titles in different lengths and formats are powerful the genre, including Poirot, Foyle’s assets in multi-platform media. Some War, Doc Martin, and Miss Fisher’s content may translate well across platforms, Murder Mysteries. In 2015, Acorn TV other assets may require a comprehensive premiered the final three episodes reinvention for specific platforms. of its franchise, Poirot, starring 3. LEVERAGE THE LONG-TAIL OF TALENT. David Suchet, including the Emmy- Due to advances in camera technology and nominated finale ‘Curtain,’ resulting in content creation tools, it is easier than ever to a major boost to subscriber growth. produce great content. Thousands of talented In March 2016, Acorn TV revealed video creators globally can help it had reached over 240,000 paid you create content. For example, the subscribers, a 100% increase in year- Tastemade OTT service has scaled with over-year subscribers11. contributions from over 5,000 creators around the globe. “INSTEAD OF TRYING TO BE ALL THINGS TO ALL PEOPLE, WE CAREFULLY CURATE RICH AND DEEP CONTENT OFFERINGS THAT SERVE DEDICATED NICHE AUDIENCES. OUR ACQUISITION AND PROGRAMMING STRATEGY KEEPS CHURN LOW AND CUSTOMER REFERRALS CONTRIBUTE TO OUR HIGH CONVERSION RATE.” -Titus Bicknell, CDO & EVP, Operations for RLJ Entertainment on Acorn’s content strategy ©2016 Brightcove, Inc. All Rights Reserved. 7 2: BUILD TOWARD MAXIMUM BUSINESS MODEL AGILITY Media businesses have thrived using a mixture of free, ad-based subscription and transactional business models.
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