How To Acquire Subscripers To Ott Service

9 Keys To Successful OTT Video Subscriptions

Introduction

The shift to subscriptions is happening across all industries, but nowhere is it happening faster than in media and entertainment. Today's consumers have new expectations and preferences on how they want to purchase and accept advantage of media products and services.

While the industry has used subscriptions in various forms for a long time, it has traditionally relied on advertising for its core acquirement. But, a few years ago many media companies began to experience the vagaries of a cyclical advertizing market, and realized their viewers were going to be their nearly important acquirement source.

In this changed media landscape, the growth of 1 strategy is outpacing the rest – a shift to digitally enabled, multiscreen OTT video subscriptions.

OTT, or over-the-summit, refers to content that is delivered over the cyberspace and does not require a traditional broadcast or cablevision video infrastructure to distribute it. For telecom, cablevision, media and content businesses, OTT video subscriptions stand for a new business model congenital around ongoing customer relationships. It allows them to take advantage of modern IP-based engineering science to collaborate more straight and regularly with consumers – anywhere, anytime and on any device.

This shift to digital OTT video subscriptions is not easy for all media businesses to operationalize. How companies price, sell, neb, collect payments and account for digital subscription services can be significantly more circuitous than in the traditional media world. Internal stakeholders in Marketing, Operations, Finance, IT or General Management, must be prepared and aligned to back up this transformation, which often requires knowledge and implementation of new digital processes.

Fortunately, global media companies like News Corp, HBO, Rogers Media, RTL, Time, The Fiscal Times, Fairfax Media and over a hundred other Zuora media clients have re-emerged with new growth strategies and launched adjacent generation digital subscription models to monetize their content and services. Based on key insights gleaned from Zuora's media customers, partners and the community of subscription businesses at large, this is our attempt to aid telecom, cablevision, entertainment and media companies thrive with practical guidance.

The shift towards OTT subscription business organization models is driving companies to build better means to run their businesses. In this new world, how you price, sell, nib, collect payments and business relationship for your digital media business is entirely different. - Amy Konary, Founder and Chair of the Subscribed Institute and VP, Customer Business organisation Innovation at Zuora

A Meliorate Way to Run Your Business

An OTT video subscription model is a win-win for both customers and media businesses – Customers benefit considering subscription-based businesses are focused on customer success, earning trust and continually providing new offerings to meet subscribers' modern digital requirements. Businesses win because as long as they keep to run into their customer's needs, they will proceed to earn more than anticipated recurring revenue.

In addition, businesses have direct insight into viewers' usage patterns and can tailor offerings based on existent usage metrics, much the same fashion Netflix serves upwardly a personalized dwelling page to each i of its viewers. This level of insight is unavailable in a strictly advertising-supported environment.

Many telecom, cablevision, entertainment and companies take realized that an IP-centric, OTT video business model built on recurring revenues is a meliorate way to run their business. In order to grow, companies must recognize and operate around four critical values:

Developing deeper digital customer relationships vs sending invoices for transactions.
Establishing dynamic, flexible value-based pricing vs a global fixed, cost-plus pricing.
Iterating pricing, services and products based on insight into consumption and usage patterns.
Measuring and reporting predictable, forward-looking acquirement vs backwards-looking financial statements.

Equally y'all prepare to transition to this new concern model, several questions volition ingather upwards such equally:

"What is the best way to launch a new OTT video service?"

"How do I cost effectively?"

"How do I reduce the number of failed credit card transactions?"

"How practice I reduce churn?"

"What are the metrics I need to understand and grow my OTT subscription-based business?"

"Do I build or buy a organisation to reliably back up my business growth?"

Over the by eight years, Zuora has arrived at answers to these questions through our partnerships and conversations with subscription based media companies of all sizes and geographies. We distilled the inputs, analyzed common themes and a very clear and consistent picture began to emerge.

The 9 Keys to OTT Video Subscription Success

These key principles volition serve as your foundational design for edifice and scaling a subscription-based OTT video business:

PRICING in back up of your business organisation goals:

With an OTT video subscription, pricing and packaging is your almost valuable strategic tool. It's directly tied to revenue growth through new customer acquisition, increasing the value of existing customers, and/or reducing customer churn. Just as it turns out, subscription pricing and packaging tin can be quite circuitous.

You lot can price by number of users or chapters, family plans or grouping plans, concurrent streams or by device type. You tin price by dissimilar fourth dimension periods — daily, monthly, quarterly, annually. You can use promotional models like freemium, free trials or partner offers to hook in customers at no price. You can discount for multi-yr purchase to incentivize long-term use. You lot can offering special pricing based on related services that users may already be paying for.

It's best to proceed information technology simple – start with basic models and iterate over time as yous learn from your customers. You will need flexible operational systems that support regular iterations and allow you to respond apace to your customers changing preferences.

Acquire Customers Beyond any Aqueduct:

Signing up customers for subscriptions needs to be a seamless user experience that can be done across multiple channels such every bit the web, tablet, mobile, smart Television or through assisted sales. Traditional systems were non designed to support the elements of the IP-centric OTT video subscription. Complexities in the customer acquisition process oft lead to dull time-to-market and to single-channel commerce.

OTT video subscription businesses need to establish fast, simple, streamlined and automated customer acquisition workflows across multiple channels.

BILL with Accurate, Intuitive Invoices

In a traditional business organisation, products and services are one-time purchases with more often than not single invoices. Billing for a subscription business is more complex — businesses have to bill new customers at sale, prorate customers that sign up mid-month, bill existing customers at different times of the month, bill for usage, etc. Without the right billing engine, information technology can take weeks to generate bills, errors may atomic number 82 to frustrated customers, and it will be a challenge to scale.

The new complexities in billing for OTT video subscriptions require businesses to not only ensure accurateness only likewise present information technology in an easy to empathise manner to subscribers. Your billing arrangement needs to be a programmable engine that takes all the various inputs, calculates accurately and delivers a clear nib that's in sync with your company's make and image.

Collect Fast Cash and Easy Settlements

In the product globe, payments are relatively unproblematic: You either pay for it upfront, cash or credit, before being given the production, or companies will check credit history and open a line of credit, assuasive the client to pay on net-30 terms. That does not piece of work for OTT video services with a recurring model.

Media services deal with many more collections and accept more sophisticated processes. Automation is the key to optimizing cash collections. OTT video subscription businesses need to collect greenbacks fast, maximize collections and minimize write-offs.

NURTURE and develop deeper customer relationships

Developing deeper customer relationships is at the core of the OTT video subscription business organisation model. As a company's customer base of operations gets bigger, this becomes one of the most important elements in the entire framework. Acquiring new subscribers is critical, only a vast majority of client transactions consist of changes to existing subscriptions: renewals, suspensions, add-ons, upgrades, terminations, etc.

OTT video businesses need to provide customers with intuitive and comprehensive tools to manage their accounts over the entire subscription lifecycle. They must give subscribers the command they want or hazard client dissatisfaction, which in turn leads to churn and revenue loss. Businesses must also closely monitor customer usage and adoption to mitigate churn hazard or identify upsell opportunities.

ACCOUNT for Revenue and Close Books Faster

An OTT video subscription typically has a large number of order transactions and changes over its lifecycle. This creates a ripple effect on bookings, billings, cash and revenue. Traditional GLs solitary cannot handle complex processes such as revenue recognition rules brought on past the subscription model. This claiming may not go addressed when a company initially launches its subscription offering. As a result, subscription finance processes end upwardly being handled manually in spreadsheets.

Businesses still need a GL to generate financial statements. Your OTT video business needs to place a improve, more integrated manner to streamline accounting-close processes and maintain compliance.

MEASURE using the Right Customer, Subscription & Financial Metrics

OTT video subscription businesses ofttimes need to make swift decisions that leverage key metrics from bookings through revenue recognition. They need to have unparalleled insight into client value and the financial wellness of their business. Traditional GAAP reporting will non get abroad presently, even so subscription businesses must also focus on unique metrics similar ARR, retention rate, recurring profit margin, and growth efficiency index to be successful.

Unfortunately, many businesses are flying blind since traditional financial systems are unable to provide these metrics. Identify a arrangement that focuses on subscriptions and will help generate the metrics critical to your OTT video concern.

ITERATE and Rapidly Deploy New Pricing

OTT video subscriptions take infinite pricing options and companies typically start with a simple recurring pricing model when launching their subscription offering. Just markets tin evolve quickly and customers' needs will likely change over time. Competitors may enter with a differentiated offering.

Your concern will need to apace iterate on pricing models to maximize subscriber acquisition and increase market place share. It's critical that your pricing and packaging is flexible and dynamic.

SCALE with Mission Critical, Reliable and Secure Infrastructure

Subscription businesses need an enterprise-grade organisation with services that are built on a secure, mission-critical and scalable infrastructure with reliable vii/24/365 operations and assured business continuity.

Telecom, Cablevision, Entertainment and Media companies peculiarly need the infrastructure back up to scale apace and have seamless integrations with commerce systems, payment gateways and other applied science systems.

For more than on implementing the OTT Video ii.0 strategy, download our Blueprint for a Subscriber-Centric OTT Video Business concern. Based on best practices that Zuora has arrived at working with leading media companies, the design highlights the five key areas to consider when developing or transitioning to a subscriber-centric OTT Video 2.0 platform.