Monthly Archives: April 2013

April 25, 2013 · 11:11 am

Water Everywhere But…

I know – you were thinking about Coleridge when you woke up this morning.  Hey – me too!  In particular, the line from the Rime Of The Ancient Mariner about “water, water everywhere but nary a drop to drink.”

Image representing YouTube as depicted in Crun...

Image via CrunchBase

OK, I didn’t wake up thinking that but I was reminded of it when I read some data put out by the folks at Outrigger Media.  They measure how brands use YouTube.  The top 500 brands generate 442 million views every month – a bit less than a million each on average, which is pretty good.  But there are some other data which are a little concerning that I thought you might find interesting.

If you’ve spent any time on YouTube (go ahead, admit it!) you’ve probably noticed that much of the branded material is just repurposed TV ads.  In fact, in some brands’ categories (food & beverage), 15% of the videos are just that.  The technology, automotive, and apparel brands (who seem to do a lot of original content – demos, mini-movies, etc.) on YouTube are attracting the largest audience, more than half of the Top 500 brands’ monthly views.  However, the top brands channels are averaging just 35,000 subscribers, which is way less than their number of Twitter followers (more than 200,000).

Many clients have mentioned “going viral” as a goal with some video content.  I caution them that it’s a lot easier to capture lightning in a bottle.  Basically, there’s research that shows you’ve got about three days to make that happen, and if the content hasn’t been shared a lot by then it’s probably not going to happen (even though it can keep growing for a few months).  That said, the Outrigger data shows that we have a fertile field – YouTube – that’s one of the biggest audience areas on the internet and yet brands can’t seem to make anything grow there on a consistent basis.  If consumers had a strong interest in what the brands were planting, why wouldn’t they be asking to be updated regularly by subscribing?  Apparently, not enough fear of missing out in this case.

YouTube is the ocean – there’s water everywhere in the form of consumers from which thirsty brands are trying to drink.  Look like Coleridge was right.

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April 24, 2013 · 9:47 am

How To Ask The “Best” Question

A client asked me about the “best” social game company the other day. Like most simple questions, this one had no simple answer. How was he defining “best?” The one that made the most engaging games as measured by how long users were playing? The one that sold the most games? The one that was most profitable? Or maybe the one that creates games that really are works of art? Each of those questions has a different answer in my mind so I did what a lot of we consultant types do: I answered his question with a question.

Putting my confusion aside, that simple question raises a good business thought.  Let’s ask it about TV.  What’s the best program on TV?  I might answer that as a fan – the one I like the most and which is appointment television for me:  Homeland, The Newsroom, and even a program that’s not on “TV”, House Of Cards.  Obviously, I’m defining “best” in a way that takes writing, acting, plot, and other factors into account.  I might answer it as a former TV executive (which I am!): The Voice, American Idol, and even Duck Dynasty come to mind.  They’re watched by some of the biggest audiences, they’re not particularly expensive to produce, and they take in a lot of money.

Which is the “best restaurant ”  If one of Thomas Keller‘s places come to mind, I’d agree answering as a foodie.  As a businessperson, maybe the right answer is someplace that feeds millions and makes over a billion dollars a quarter?  Not that McDonald’s tops any fine dining lists of which I’m aware.

The point is that how we answer questions is very much tied to our point of view.  If you’re asking them, it’s important to figure out from which perspective you want the answer given.  If you’re answering them, it’s critical that you ascertain the underlying reason for the question in the first place.  As with the above examples, your answer may be very different based on that.  A little clarity can go a long way in advancing business success. Have you found this to be the case?

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April 23, 2013 · 10:56 am

Taking An Umbrella

Sometimes I think that changing landscape of the media business is like the weather:  everyone complains about it but almost no one does anything.  In fact, if you spend any time at all following developments in the media space, you read a lot more about the old models trying to sue the new out of existence (Aereo, YouTube, etc.) than you do about new models being adopted quickly by the older business models.  So today, we have a little food for thought and an example of what can happen when a newer company adapts rapidly.

Image representing Netflix as depicted in Crun...

Image via CrunchBase

As reported by multiple sources this morning:

Netflix‘s Q1 numbers are in, and the company reports that it now has 29.17 million subscribers in the US alone — that’s 2 million more than the number of subscribers the streaming video provider had at the end of 2012. Globally, Netflix reports more than 36 million subscribers, an addition of 3.05 million new customers when compared to the end of 2012/previous quarter…This is, for the first time, greater than HBO’s domestic subscription base of 28.7 million.

And another point:

Netflix isn’t a cable network, but it competes for attention with television fare beyond just HBO. And in that context, Netflix commands more attention—87 minutes per US household per day—than any American cable network.

30 million subs at $8 at month is a quarter of a billion dollars every month in gross revenues and high engagement.  Not too shabby.  That money is funding original programming such as House Of Cards (the implications of which I discussed earlier).  Moreover, House Of Cards itself was bought using all of the knowledge Netflix had on its subscribers’ viewing habits and preferences, something older media doesn’t have since the traditional TV ratings provide next to nothing of value when compared to the granular data streaming services have.  Anyone see that changing?

A couple of years ago Netflix was tied in to physical media, which is still a small percentage of its business.  It was smart enough to pivot to streaming, taking advantage of the growth of broadband and the ubiquity of mobile devices that can’t handle the physical media upon which Netflix had originated   Sure, there was a rather large misstep along the way as they separated the DVD and streaming price plans.  However, they did an excellent job of recovering over the last 18 months, mostly because they listened to their customers and provided increased value by adding more original programming.

The lesson I take from this is that spending energy defending an outdated business model rather than moving forward to take advantage of the new opportunities provided by market changes is ultimately a recipe for failure.  Like the weather, the change is going to happen.  Either dress appropriately or drown in the rain.  You with me?

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