OTT Moneyball: Leveraging data to hit a homerun with cost-effective content
Updated: Jun 5, 2019
MONEYBALL, by Michael Lewis, is a book about his experience assembling a competitive baseball team despite a particularly small budget. To accomplish this task, he introduced a groundbreaking new strategy of valuing potential acquisitions based solely on analytical, evidence-based metrics.
Here is a story about how PeerLogix helps budget minded OTT networks accomplish the same goal as they look to develop new strategies around their content acquisition efforts...
We know that certain shows are always going to be ‘subscription drivers’ - those shows that are guaranteed to attract and retain viewers - these are the shows that are sought by every OTT network and that are, therefore, extremely costly. And, while we understand that any OTT network trying to remain competitive will certainly have to license a core number of these shows, PeerLogix has developed a way for a budget-minded network to leverage our proprietary data to help them make the decisions that will drive the highest number of subscribers with the least amount of churn, while keeping the cost of content acquisition as low as possible. Essentially, we have applied the 'Moneyball' strategy to the process of planning and acquiring content for any OTT network.
In developing this strategy for our clients, we focus on whether there are characteristics of some shows that might make them valuable acquisitions in ways outside of the traditional perception. To do this, we first defined that the two primary attributes of a classic ‘subscription driver’ are 1) its ability to pull in new subscribers to the network over a distinct time period (we call this its ‘momentum’), and 2) its ability to maintain a sense of scalable viewer loyalty over a long period of time (we call this its ‘strength of viewership’). Clearly those highly sought after ‘subscription drivers’ will score well in both categories, but they are also amongst the most expensive shows to license- think Big Bang Theory or Criminal Minds, two of the biggest OTT draws from the world of CBS.
But what if we looked at ‘momentum’ and ‘strength of viewership’ scores independently? What if we could identify shows that scored particularly well in one, but not necessarily in both of the categories? Wouldn’t we then be able to find those less sought after 'hidden gems' that could be picked up at a bargain, but that would individually still provide real value any OTT Network?
This question led us to find a way to customize our vast library of OTT streaming viewership data for the Network in a way that would specifically identify shows that performed well in one of the two categories.
The first new category we have created in our OTT Moneyball paradigm is one that illustrates a show’s ‘momentum’ by looking for those titles whose viewership numbers are growing at a faster rate than average, but whose total viewership might not yet be considered notable. For these shows, we don't focus on the size of the audience, just the speed with which they are catching on. The idea is that these shows with a fast growing, though niche, audience might well be flying under the radar of other networks and, therefore, might not cost as much to license. If we keep our client Networks updated with a fresh list of these smaller shows that have real momentum, they are able to pull in dedicated fans that are not seeing their ‘hidden gem’ on other networks. Staying in the CBS world, one example of a ‘niche attractor’ is Hawaii Five-O.
On the other end of the spectrum, we look for shows where 'strength of viewership' is strong but where numbers of views are not necessarily growing rapidly. These are less flashy, OTT 'comfort shows' that stand the test of time but that may well be flying under the radar, as well. Putting it into context, these are shows that make your OTT network feel like 'home' and once a new subscriber realizes they can find them on your network, there won't seem to be any reason to leave. To use an example from our growing CBS construction, did you know that there have been 38 seasons of Survivor available to stream?
Once armed with this new data-supported and cost-effective way of grading shows, a network can began to build a content library with a healthy balance of Niche Attractors and Churn Reducers. And, while they will also spent some dollars on the higher priced 'Subscription Drivers,' they will do so in a far more educated way.
We are excited about how the PeerLogix data-fueled 'Moneyball' strategy can allow up and coming OTT networks to stealthily build up viewership, while keeping costs low, and to position themselves as major players in the space.
If you would like to discuss how we can help you build this kind of 'OTT Moneyball' strategy for your content acquisition initiatives, please reach out to us at info(at)peerlogix.com or fill out the 'contact us' form our homepage.