How to Win the StreamingWars
Prof G [Scott Galloway], recently hosted a webinar on the topic of StreamingWars. He shared how the average American spends 18,316 minutes annually watching TV commercials.
On average, every person in America spends 3 hours and 13 minutes per day watching TV, with 26% allocated to binging on ads [50 minutes per day]. For those of you who have yet to cut cable, or, if you consistently watch live broadcasts, then you can spend upwards of 4% of your entire year on ads.
“Time isn’t the main thing. It’s the only thing.” -Miles Davis
It is time that Media companies change the way that you watch TV and give you more time back in your day.
TV networks and countless OTT options are competing in the StreamingWars, where these content providers are aiming to become your primary destination to stream video. With time spent on mobile dominating our time and attention, mobile apps are now the frontlines of this new frontier.
When you download a media app, you need to authenticate to some degree during FTUE [first-time user experience] before you can stream content. Onboarding is where virtually all of these companies are missing the mark.
There are two distinct DTC services in the streaming video-on-demand category, TVE, and OTT.
TVE [TV Everywhere]
TVE services include networks you are intimately familiar with, such as NBC, ABC, TNT, etc. These channels you grew up watching now need to entice you to authenticate with your cable provider to comply with their cable contracts, which remains a challenge to their DTC growth ambitions.
Following the process of authenticating with your TV provider, these apps will [or should have by now] ask you for your email address so they can associate you as an individual user of their services.
For brands delivering TVE apps, DTC is a novel concept. As a result, if you like the app and want to stream long-form content, then you are going to eventually want to stream content from your living room through a connected TV device. The providers are Roku, Amazon FireTV, Apple TV, Xbox, PS4, Chromecast, and apps available in the native Samsung or Vizio Smart TVs.
Most TVE apps let you stream directly to your living room via Chromecast and the icon in the video player. If you, like most people, do not have a Chromecast device, then you will be forced to activate everything again through a clunky UI with only your, definitely not made for this, TV remote.
Once you get a code from the TV app, virtually all of these services force you to the mobile web, not the app you just downloaded, where you pair the devices with your account.
If you authenticate NBC iOS app with a TV provider during FTUE [and have your provider already synced to your iOS], and want to activate a new NBCU profile, then you will see a minimum of 16 screens before seeing the home page.
To sync the NBC app with your FireTV, you will have to type through 5 screens on the mobile web, a completely unnecessary, frustrating process. You then need to complete the entire journey yet again with only your dinky TV remote [i.e., authenticate with your provider in addition to syncing your NBCU Profile, which is the whole point of accessing NBC content on both devices].
Phew, you battled through 30-odd screens. Now, you are ready to stream or curate a watchlist from your iPhone, and you can pick up where you left off on FireTV. Assuming you still have an intent to watch something, you hit the play button on This Is Us, and you get hit with an ad. Even if you tap on a 45-second clip, of say, Jimmy Fallon, then you have to sit through yet another commercial. Want to share it with someone? They, too, will be gated by an ad, so you will not text it to your friend because you know they are impatient, like you.
OTT [Over-the-top]
OTT services like Netflix, Hulu, CBS All Access, Disney+/ESPN+, Apple TV+, etc., bypass cable authentication. These brands, with very few exceptions, strive to activate you as a subscriber, whether paid or ad-supported, during FTUE. Virtually all of them offer a free trial. Peacock from NBCU, for example, will have three tiers — free, premium with ads, and premium [ad-free].
There were 532 scripted shows delivered in 2019. How are these DTC services going to become part of your daily or, at a minimum, your weekly routine? As it stands, your spouse/partner, friends, or coworkers are probably guiding your choices on what to watch. And, when you sit down to start a series, you might wander across apps to find the show.
If you have Amazon Prime Video with Apple TV or Apple TV+ with FireTV, it is not as easy to keep up with all of the apps on your TV. As with NBC, you will likely find yourself authenticating on the mobile web, even if you have the app on your phone. Disney+ is the only modern OTT app that makes it stupid simple to activate on FireTV directly from the app.
Apple TV+ enables the most seamless user experience, providing yet another edge to lure subscribers into Channels. Apple, unsurprisingly, nails the Apple TV+ experience. The app delivers exclusive content, and, with Channels, hosts all of your favorite content in a unified, easy to navigate UI. With this service, you will never have to ask, “what service is that one show on again?” I just migrated from HBO NOW to the HBO Channel simply because it is easier and presented beautifully. That is not good news for HBO.
Apple TV+ is an exciting distribution option for its partners. HBO, CBS All Access, Disney+, and dozens more are available as a Channel subscription. You do, however, have to authorize purchases via your Apple devices if you access the app outside of their ecosystem — i.e., FireTV.
Whether they understand the implications or not, Apple’s new OTT service is already a challenge for Channels partners in the same way Kimberly-Clark Corporation is vulnerable by selling Huggies through Amazon. Like all subscriptions delivered through their ecosystem, they take a revenue cut.
If Apple owns distribution entirely, then providers of Channels do not acquire an email address, and can only target their subscribers through the Apple ecosystem. It is also difficult to imagine that privacy-conscious Apple will provide anything outside of anonymized consumption metrics.
Media brands are new to DTC, for the most part, and cannot afford to relinquish control of the dialogue with their consumers. Digital product teams also need immediate feedback in the form of behavioral analytics, as relying on content analytics limits their ability to deliver compelling experiences and retain users/subscribers. Disney+ is an incredible value, although they, too, must win and keep subscribers on their platforms.
Failing to distinguish an app’s experience is limiting media brands from reaching their full potential.
The notification from Apple TV at least promotes that you can add the new show to your queue, which ads context to what is possible for the user.
The Fix for Media Brands: Focus on the Viewer
In the StreamingWars, content is not king because a streaming library is not necessarily the primary driver for retention. Reducing friction should be the focus for product and development teams, and marketers need to reinforce the behaviors that successful and retained users are exhibiting.
Media brands are facing fierce competition on mobile for the attention of users. Social dominates and the top 5 apps are responsible for 85% of all time spent. A survey from September 2019 showed that even Twitter only makes up 1.3% of all time spent on mobile apps in the US.
Retention is an issue that plagues all who develop apps for consumers. There are 2.2M iOS apps, and 2.6M Google Play apps available globally. There is no standard for mobile app statistics since vendors are most often the source. So, let’s believe a stat showing that 20% of users abandon an app after opening it merely one time, which leads us to assume that brands have a single shot at bringing users to value.
Statista shows that it costs brands $3.60 to acquire a new app user across all categories. Additionally, the same study illustrates that it costs $33.12 to acquire a paying subscriber.
Apple has an incredible edge since they dominate the device ecosystem. Apple’s product and marketing experiences are setting the bar that every organization should follow. They demonstrate incredible empathy in everything that they deliver to consumers.
The StreamingWars have become one of the single-most competitive markets in history. It is especially challenging for those who solely monetize through ads, hence NBCUniversal launching Peacock with an ad-free tier. To win in the trenches, which is only getting more fierce with the upcoming launches of Quibi and Peacock, Media organizations must focus on what is possible for the user. When asking for anything, such as an opt-in for push notifications, explain what is in it for them.
Here is an example of a marketing campaign that can increase the number of app users that authenticate in the living room, which ultimately leads to longer streaming sessions [and, of course, more ad impressions].
Delivering contextual experiences requires that marketers have self-service access to behavioral data and not just content analytics. Media brands should also leverage a modern growth stack, which is a reference to solutions that integrate seamlessly and enable much more flexibility than web-first products offered by Salesforce, Adobe, etc.. Modern tools that empower novice workers to explore behavioral data in a self-service way and collaborate on charts are an essential piece to solving the customer experience puzzle.
Amplitude, for example, is a platform that expands organizational access to behavioral data, so non-technical teams can now understand the specific attributes that differentiate successful subscribers from those who churn.
Through productized integrations with modern tools like Braze, Airship, and MoEngage, marketers can inform campaigns and focus on measuring their impact on user retention. These platforms also process streaming [think real-time] events, which is essential for triggering messages off of user behavior.
Thank You for Coming to My TED Talk.
Media organizations are competing in the trenches for content, driving-up the acquisition price of each asset. While they spend billions, with no guarantee they have a hit on their hands, must stop promoting their libraries of shows, and focus towards helping people become habitual product users. As a result, those who do invest in the experiences they deliver to viewers will be the ones that win this high-stakes war.
— Rory Kane
