As OTT apps become more popular with consumers, digital broadcasters both large and small continue to flood the market with apps of their own. From small, niche content producers, to Comscore Top 100 media giants, newcomers to the digital video economy run the gamut in size, strain, and sophistication.
And while the number of competitors continues to grow, the resource they’re competing for is still decidedly finite — consumer attention. However, just because a resource is finite doesn’t mean it’s fixed. If the COVID-19 pandemic taught us anything, it’s that the demand for digital video consumption has room to grow; although the worst of the lockdown days are behind us, it continues to do just that.
According to data from the JW Player broadcaster network, which includes over half of the Comscore Top 50 media properties, video consumption has seen a 28.6% increase since the beginning of 2021. Since the beginning of 2020, consumption is up over 50%. OTT app-based consumption has seen the most significant increase, up a whopping 361% since 2020. This follows a 133% increase in distinct apps active across the JW Player network in that time.
So, despite increasingly stiff competition, there’s still ample opportunity for growth. And thankfully, our market research has revealed some key findings that every broadcaster should be aware of in order to seize those opportunities in 2021 and the years to come.
Make Audience Engagement Your New North Star
In a recent survey of broadcasters using the JW Player video platform, we found that 76% of broadcasters said increasing audience engagement was their #1 challenge this year. With video consumption exploding across new screens, devices, and platforms, audience engagement provides a comprehensive, well-defined target for broadcasters to measure and grow their share of the attention economy.
What makes engagement so effective as both a goal and guide, is its ability to encapsulate the kind of “bottom line” trends that matter most to broadcaster success — namely, reach and retention (and, in turn, essential financial metrics such as subscriptions and ad revenue).
Reach can be measured by the number of unique viewers, the average ad impressions per viewer (for AVOD broadcasters), and share/interaction rates on social media. Retention, on the other hand, can be measured by complete rates and viewing time.
A high complete rate shows that a video can keep a viewer engaged through its entirety, while high partial complete rates can help broadcasters pinpoint where audiences stop watching.
Then, of course, comes the all-important matter of actually increasing audience engagement. The specifics of any strategy should first-and-foremost be informed by one’s own analytics. However, the majority of strategies aimed at increasing engagement are centered around user experience.
A few examples of effective UX-driven strategies include:
- easy to understand, clickable navigation;
- focus on searchable content and search function optimization;
- access across multiple devices (including web, mobile, and OTT);
- live streaming for special broadcasts;
- and, of course, vigilant monitoring of industry trends and standards.
Digital-First Broadcasters Stand to Benefit from Mixed Monetization Models
Recent trends in consumption have highlighted the need for flexibility when it comes to monetization. We’ve reached a point of saturation where audiences are wary of subscribing to yet another OTT app. At the same time, broadcasters need to be careful not to compromise their viewer experience with excessive advertisements. The key is to utilize a strategic mix of monetization models to entice and retain audiences.
Ad-supported, freemium, and subscription models all offer their unique set of advantages and disadvantages. But considering the diversity of preferences found across viewers, it only makes sense to cater to more than one cohort. And broadcasters are catching on — according to a recent JW Player survey, 41% of digital-first broadcasters are increasingly interested in exploring new monetization strategies.
In a recent analysis of the JW Player network, the average revenue per user (ARPU) for SVOD services was 100x that of ad-based services. However, with subscription fatigue at an all-time high, conversion for those SVOD services hovers around just 10%. A freemium model combining ad-supported, subscription-based, and pay-per-view content can help broadcasters effectively achieve both reach and revenue.
By exploring tiered, or mixed service models, broadcasters can cast a wider net, and diversify their revenue streams.
One can allow subscribers to control the amount of advertising they see by providing low-to-high pricing options. One ad-free tier and one ad-supported tier is a good balance. Another effective strategy is the application of pay-per-view pricing to special events or live streams.
Niche Broadcasters Stand to Build Loyal Audiences with OTT Apps
In today’s saturated video market, the key to success is to provide content that isn’t available anywhere else. This is why niche broadcasters have the most to gain from OTT apps. Offering specialized, unique programming enables broadcasters to not only compete with the Netflixs and Hulus of the world but also to build loyal, highly engaged audiences.
Fortunately, the barriers to entry for launching OTT apps are lower than ever. Through OTT apps, broadcasters can reach new audiences where they are already primarily consuming content, whether that’s on the web, mobile, or Connected TV. In particular, Connected TV viewership is already nearly double that of desktop/laptop and is forecasted to overtake mobile viewing in 2021.
In addition to increasing reach, OTT apps allow broadcasters to produce premium, branded viewing experiences that boost engagement. Custom designs, such as in-app search, content recommendations, and mobile notifications, can promote new content discovery and maximize viewing time.
OTT apps also give broadcasters direct access to more robust data, which in turn opens up the opportunity for more effective analytics and content optimization. In addition, custom apps allow for more control and flexibility over monetization options, whether that means subscription, advertising, or transactional models. The result is more opportunities to drive revenue growth.
Something to Take With You Into 2022
The pandemic catalyzed a dramatic shift in demand for digital video. Consumption surged across all screen types in 2020 and has continued to do so in 2021. There’s little reason to believe this growth will slow down in 2022. With the right tools, broadcasters of all stripes can launch their own OTT apps to deliver compelling viewing experiences to their audiences, increase engagement, and grow revenue.