As we head towards Q4 and enter into awards season, it's a good time to reflect on how the industry has transitioned over the past few months.It's safe to say that the video e-commerce business has matured greatly.
- Competition has intensified to multiplied levels.
- Broadcasters have been increasing investments in modernizing, organizing, and acquiring content and improving customer experiences.
- There's also greater concern regarding tighter cash flows while battling rising subscriber churn levels.
Amidst this turbulence, the main concern for most broadcasters revolves around exploring ways to increase efficiency, achieve operational cost savings, and grow profits. This is bringing attention to increasing ROI.
Gilles Domartini, CEO Cleeng, recently shared insights with Stuart Thompson, The Editor of Digital TV Europe, on growing ROI in today's competitive OTT climate.
Check it out:
How can broadcasters optimize video e-commerce ROI in 2023 and beyond?
The best way to optimize OTT streaming ROI is following a two-pronged approach around igniting ARPU & simultaneously cutting costs.
Here are some of the trending techniques that have emerged to translate this into reality:
1) Offering mixed monetization models to increase revenues
Several monetization models such as SVOD, AVOD, and FAST, have emerged over the years to monetize VOD content. Now is the time to get creative and combine these models. Today, mixed monetization models are trending to cater to customers who are willing to spend and also those who are too price-sensitive.
Mixed monetization, in fact, was a hot topic at IBC 2023. Cleeng VP of Product Marketing, Damien Organ, participated in a panel discussion where he explained how the rising popularity of FAST is a natural result of today's market. However, he iterated that it is not the ultimate solution and a combination is necessary.
Practically executing monetization can get complex, and broadcasters need to account for it. For instance, "On the monetization side, the challenge is figuring out how you are going to forecast revenue around content, because now you're not just trying to forecast subscription revenue, but you're trying to add the naturally volatile advertising dimension to it as well," explained Damien. Getting this right is critical to ROI optimization and is possible with the right toolkit.
Watch the panel discussion to find ways to sort out these complexities using a unified dashboard.
2) Controlling churn
Acquiring customers is costly. Losing them to churn shrinks profits extensively. Therefore, broadcasters are now realizing that managing churn is vital to growing ARPU and reducing costs.
The best way to control churn lies in understanding the subscriber behavior at different stages, from payments to customer service, and using that to tailor experiences to enhance retention.
"What's absolutely crucial is understanding churn drivers in a descriptive way. That's the foundation. But then, are you benchmarking against what it looks like for another OTT service? Not what it looks like for a mobile phone company or some other type of subscription business, but against other OTT providers. Your subscriber management system should be telling you - is price a big problem for you? All of these problems in isolation look very big, but you really need to sit them next to each other and really understand: what is it for us that's really the thing that we should start with? And that requires unified data, and that requires a bit of patience as well," explained Damien.
As processing that much data can get complex manually, data science is bringing a simplified solution to generate insight. In turn, AI and ML capabilities to predict and prevent churn are gaining center stage.
3) Reducing costs
While increasing and maintaining that revenue is one aspect, controlling costs is essential to ensure a healthy bottom line.
Some promising ways for that include:
- Adopting cloud technology and multi-tenant SaaS models: This can reduce customization needs and, in turn, minimize platform launch costs. Moreover, this can also ensure continuous optimization to remain competitive.
- Entering strategic partnerships to optimize costs and scale: "Scalability is an essential factor of any SVOD platform. There are plenty of examples of platforms suffering from outages at critical moments of their journey. As technical and business teams, you need to ensure you're prepared for events like season launches, and everything goes smoothly," explained Gilles in the interview with Digital TV Research.
Being prepared requires investing in the proper technical infrastructure, and picking a stack of dependable vendors is vital. This needs to include those that can integrate with other essential services and work with leading industry partners to support the VOD platform's growth journey.
- Offering automated multi-lingual customer support: Using chatbots can ensure prompt responses without raising support costs.
Wondering how to put this all into action to boost your video e-commerce ROI?
Cleeng is dedicated to providing technical solutions to help broadcasters supercharge their ROI.
Here are some performance statistics that our clients have been able to achieve:
- Reduced OTT platform launch costs by 70%
- A launch in 3 weeks, thanks to SaaS, with up-to-date customizations
- Transparent pricing models to grow profits by up to 900%
- Churn prediction with 95% accuracy
- Reduced churn rate by 35% in 3 months
- Identification & saving of 25% of at-risk customers with AI churn prediction
- Improved CLV by 30% through personalized offers
- Integrability with over 35 connectors
and much more…
Want to know if these results could be achieved in your platform?