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Interactive Online Video Market of Germany

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Interactive Online Video Market of Germany 2012 Interactive online video market of Germany Author: Lauris Mikals Student number: 45857 Tutor: Karin van Druenen Institution: Hogeschool Zeeland Date: 5/6/2012 i | P a g e Interactive online video market of Germany Research on how Zentrick can enter the interactive video market in Germany. Author: Lauris Mikals Van Goethemstraat 6 9820 Ghent Belgium Student number: 45857 School Year: 2011-2012 Institution: HZ University of Applied Sciences Edisonweg 4 4382NW Vlissingen The netherlands Supervisor: Karin van Druenen Company: Zentrick BVBA Antwerpse Steenweg 19 9080 Lochristi Belgium Supervisor: Frederik Neus Graduation Period: 14 February – 5 June 2012 Date: 5 June 2012 ii | P a g e All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior written permission of the author. © Copyright 2010, HZ University of Applied Sciences Vlissingen. iii | P a g e Acknowledgements First of all, I would like to thank Zentrick for accepting me for the internship and providing me with an opportunity to work on this both challenging and rewarding project. The internship has been an unforgettable learning experience and has given me a broad insight into the world of online video distribution and production. My deep gratitude goes to my company supervisor and mentor Frederik Neus, who provided me with the guidance throughout the project by sharing his knowledge and expertise. Thank you for always making me welcome in the company. I would also like to thank the rest of the Zentrick team: Pieter Delbeke, Pieter Mees and Nicholas Hendrickx. It has been great working in your companionship and also sharing out of work interests. My profound appreciation goes to all my teachers in Hogeschool Zeeland for giving me insightful education allowing me to carry tough this project. Special thanks go to my project supervisor Karin van Druenen, who gave me critical advice and the right motivation to finish this project. Also great thanks to all the people who dedicated their time to share their experience and to provide me with all the necessary information. iv | P a g e Executive Summary Zentrick BVBA is an ICT startup that delivers managed services for online video encoding, storage, delivery and monetization to a broad spectrum of customers. This report has been written to describe the German interactive online video market and give Zentrick guidelines for entering this market. The main focus of the report is on answering the research question ‘How can Zentrick enter the interactive video market in Germany?’ The conducted research includes desk research, quantitative research, interviews and internal analyses. The combination of different researches has resulted in a complete and in-depth overview of the German market. Internal analyses of Zentrick will show if the company’s offer fits well to the market. The chapter 5 “Findings” describes the state of online video market in Germany. It illustrates that the online distribution market is healthy and growing strongly. The market has experienced growth even during the period of the financial crises and it is forecasted that the growth will continue in the coming years. Superior user experience and quality of online video services have been important factors why a large portion of audience is consuming video content on their computers, tablets and smartphones, instead of TVs. Online video advertising in Germany has doubled from the last year 20111. Increasing presence of professional video content online shows that content creators understands the importance of Internet as a medium for their content distribution. Advertising with online video is more challenging than TV advertising, therefore Marketers and video producers are looking for new and innovative ways to advertise. The recommendation in the last chapter shall encourage Zentrick to enter the German market by focusing on large and medium content creators. These two target segments are capable of adopting and using the technology as they have necessary financial resources and technical knowledge. In later product life cycle stages Zentrick should also make the service available for smaller industry players. In order to accomplish that, the services should be improved. Technical barriers should be solved and the price should be lowered, for service to become more affordable. 1 (Bundesverband Digitale Wirtschaft, 2012) v | P a g e Terms of Reference Background Zentrick BVBA is an enterprise video hosting provider. The company offers several services, including interactive video technology. Zentrick has plans to enter the interactive online video market in Germany. Zentrick has made a request for Lauris Mikals, enrolled in International Business and Management Studies at Hogeschool Zeeland, to investigate the online video market in Germany and provide the company with guidelines for entering the market. Objectives The objectives of this report are: 1. To describe the state and potential of the online video market in Germany. 2. To identify relevant market segments and to outline the needs of different segments. 3. To give recommendations to Zentrick about entering the market. Methods & Process The following methods were used to prepare the report: • A review of background information provided by Zentrick. • A review of reports, white papers and presentations. • A review of online newsletter articles and expert blogs. • A review of marketing theory books. • Interviews with online video producers in Germany. vi | P a g e Deliverables The following outputs/outcomes can be expected from this report: • Zentrick will gain improved understanding of the German online video market. • Zentrick will understand different marketing segments that exist in this market. • Zentrick will have a concept of forces existing between different stakeholders in the market. • Zentrick will be able to draw an optimal marketing strategy for entering the market. Remarks of the scope of the thesis This report evaluates the recent developments and trends in online video market by including quantitative and qualitative research relating online video production, distribution and consumption in Germany. Two key elements of this report will be examination of different market segments of German video producers and how each segment evaluates interactive video technology. This report introduces and analyzes key distribution services in Germany, as well as gives examples of potential competition. Trends in German audience consumption is reviewed and analyzed. Moreover report discovers entry barriers that exist in different market segments. This report was written with research question in mind ‘How can Zentrick enter the interactive video market in Germany?’. The interactivity in videos can have many different applications, and it can generally be applied to most of the online video formats and types. The findings in this report define online video in general. In order to add the interactivity dimension to this research, online video producers from Germany were interviewed. All the findings were interpreted from the spectrum of these interviews. vii | P a g e Contents Acknowledgements ...................................................................................................................................... iv Executive Summary ....................................................................................................................................... v Terms of Reference ...................................................................................................................................... vi Background .............................................................................................................................................. vi Objectives ................................................................................................................................................ vi Methods & Process .................................................................................................................................. vi Deliverables............................................................................................................................................. vii Remarks of the scope of the thesis ............................................................................................................. vii 1 Introduction ............................................................................................................................................... 1 2 Analysis of Zentrick .................................................................................................................................... 2 2.1 Zentrick ............................................................................................................................................... 2 2.2 Marketing mix ..................................................................................................................................... 3 2.2.1 Product ......................................................................................................................................... 3 2.2.2 Price ............................................................................................................................................. 5 2.2.3 Place ............................................................................................................................................
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