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Quibi: State of the Landscape

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Quibi: State of the Landscape Copyright 2020 PMG Worldwide LLC. All Rights Reserved. 1 Quibi: State of the Landscape April 2020 After raising $1.75 billion by such institutions as Disney, NBCUniversal, Sony Pictures Entertainment, Viacom, WarnerMedia, and MGM, Quibi —a mobile-centric streaming platform devoted to short-form programming— made its long-awaited debut on April 6th, 2020, in the U.S. and Canada. What is Quibi? Founded by entertainment industry legend Jeffrey Katzenberg and seasoned tech executive Meg Whitman, Quibi is a subscription-based streaming platform designed to deliver short-form scripted and unscripted content to your phone. The name is a mash-up of the words “quick” and “bites,” a nod to the fact that episodes of Quibi shows will run roughly seven to ten minutes in length. Quibi’s selling point is that it’s perfect for on-the-go viewing. When episodes are short, it’s easy for users to watch an episode on their commute or during a break in their day. The true differentiator of the platform is its flagship mobile video format, “Turnstyle,” which allows users to seamlessly switch between vertical and horizontal video on their phones. To build on experiences and highlight interactive storytelling, Quibi also plans to leverage tools in a user's phone —including a phone’s clock, gyroscope, touchscreen, and even GPS— that tailors specifically to what you’re doing and how you watch video throughout the day. For example, one Quibi series, "After Dark," from Steven Spielberg, will only be available to watch after the sunset of where the phone is located. As privacy concerns are at the forefront of conversations, Quibi will need to be especially transparent on what features users are opting into as the platform will be accessing a ton of data from the user’s phone. How do you access Quibi, and how Once the trial period is over, much does it cost? there are two tiers for users to choose from: Unlike most streaming services, Quibi is a mobile-only streaming ser- vice as a user’s phone is the only way to consume the content. There Ad-enabled: $4.99 a month is currently no ability to access the service on the web or stream via — likely one or two spots per Chromecast or Airplay to a user’s TV (yet). episode, with some ads as brief as six seconds The app is exclusively available on Android and iPhone and gives users a free trial period of 90 days or free access for a year if they’re Ad-free: $7.99 a month T-Mobile customer. Copyright 2020 PMG Worldwide LLC. All Rights Reserved. 2 What content is available? Contrasting the user-generated and lower production quality of YouTube and TikTok, Quibi is focused on pre- mium content with high production value. Quibi is trying to turn Mondays into an event day on the streaming service with either a new movie premiere that will be told in chapters or a new series each week. The content across the app will fit into three major buckets: Movies In Chapters Daily Essentials Unscripted and Docs Marquee scripted titles Short bursts of news, Inclusive of reality shows, that will run between entertainment, and documentaries, and com- 2-2 ½ hours each season, lifestyle content being petition shows. Episodes divided into 12-14 daily pushed daily. will be mostly self-con- chapters. A new show will Daily news shows tained with a recurring be released every two produced by NBC News, format and host through- weeks on average. Telemundo, the BBC, out the series. and Canada’s CTV, while daily pop culture lifestyle stories will be produced by TMZ, the Dodo, and E!. Each day, Quibi plans to release: - One installment (chapter) of a movie - Five episodes of episodic unscripted series and documentaries - Twenty-five episodes of “daily essentials” programming. In total, Quibi launched with 50 shows with plans to release 175 original shows and 8,500 quick bites of content in its first year. What are the advertising opportunities? Quibi sold out its first year of ads —$150 million in ad revenue— ahead of its April 6th launch. That number is fixed via pre-sold ad agreements with ten exclusive partners: Progressive, Discover, General Mills, Procter & Gamble, AB InBev, Taco Bell, Pepsi, T-Mobile, Google, and Walmart. As part of its launch pitch, Quibi promised advertisers that they would be the exclusive brand in its vertical, locking out competitor brands for the next year. Quibi will feature ads from over 25 brands that are owned by those ten ad partners. It will not expand the number of partners in its first year, although those partners can introduce new brands within their portfolios on the platform during that time. Copyright 2020 PMG Worldwide LLC. All Rights Reserved. 3 In terms of ad options, a brand can run a non-skippable pre-roll ad that can be 6, 10, or 15 seconds long before an episode of any show. The ad load means that each brand will exclusively sponsor each episode of a show, removing mid-roll and ad pods from the platform. - Longer ads are recommended for longer shows that are in the 5–7-minute range. - Shorter ads are recommended for shorter shows in the 1–5-minute range. In total, Quibi will run 2.5 minutes of advertising for every hour of programming. Its ad load is low compared to traditional television, which typically runs roughly 16 minutes of ads per hour and is more in line with the ad loads on social media sites. Targeting Targeting and content alignment parameters haven’t been released to the public, but holistically, the app is aimed at Millennial and Generation Z viewers, as well as some younger members of Gen X. The platform is not boasting content for kids or families, but aiming to target the 25 to 35 year-old demographic. Performance and Measurement Strategy Within its first week, Quibi pulled in 1.7 million downloads, according to CEO Meg Whitman. Although this number is strong, Quibi was downloaded 300K times on launch day, which is only 7.5% of Disney+’s 4 million launch day downloads. Quibi also drove far less chatter on social media than Disney+ or Apple TV when those services launched. Downloads have been fairly evenly split between iOS and Android devices, with about 87% of the installs from the U.S. and 6% from Canada, according to Apptopia data. In the long run, Quibi needs about 12 million subscribers to break even. However, Whitman said that this depends on whether users opt for Quibi’s $8-a-month ad-free subscription option or the $5-a-month option with ads. Both in the short-term and long-term, there are three main ways that Quibi will measure the platform’s success: - Paid net subscribers will be the most important financial metric. - The number of “quibis” or video installments that users watch will be more closely observed at Quibi than the length of time that users spend watching. - Other user data such as who is using the platform, what titles users watch, when they visit the platform, and how they use Quibi’s features will be taken into consideration as measurements of success. Copyright 2020 PMG Worldwide LLC. All Rights Reserved. 4 Looking ahead With a stronger than projected launch, Quibi does have an opportunity to be successful as content skews towards a younger audience that also tends to be more willing to consume media on their mobile devices. Additionally, with $2 billion in funds raised and 100% of its ad inventory sold-out through April 2021, the platform has bought itself some time to grow. For brands looking to partner with Quibi in 2021, a few factors to consider: One size doesn’t fit all To create a seamless experience for the Turnstyle format, advertisers must factor both orienta- tions into the creative process for content production. Mobile-first mentality For now, Quibi is mobile-only. Although the engineering team is developing a feature to allow users to stream the Quibi app from their phone to their TV, part of the enjoyment from Quibi will always depend on how nice one’s phone is — and how large of a display it has. Social sharing is limited Netflix and Hulu prevent screen grabs only on mobile apps, but users can capture content on web browsers and desktops. Mobile-only Quibi is not compatible with desktop browsers, and it’s unclear why the platform has decided to block screenshots of its content. Without screen- shots or gifs of these shows being shared, Quibi is betting on viewers’ initial interest in the platform to be enough to get them to download the app, instead of through the digital grapevine of memes and viral humor. By preventing screenshots, Quibi could be undercutting its presence on the very social platforms it sees as so crucial to its strategy. With COVID-19 continuing to shape how users stream and interact with content, how Quibi responds in the months to come will be a fascinating saga to watch. Thanks for reading! Connect with us on social media or start a conversation by emailing us at [email protected]..
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