The 3 Mistakes Every Streaming Service Must Avoid
With the sheer proliferation of streaming services, it’s never been more critical for providers to carve out a unique position. The problem has been that before entering the market, many companies fail to ask themselves just who will be using their product.
Decisions to launch new services often come with hefty price tags in terms of content, technology investment and opportunity cost to traditional business models. If not considered from the perspective of consumer desire, the outcome can ding media organizations for years. It’s no wonder we’ve seen so many platforms meet an untimely end.
As former chief digital officer of Condé Nast and current president of Endeavor Streaming, I’ve seen this both as an operator and a vendor, responsible for building, running, advising and innovating digital entertainment businesses at scale.
And what’s become clear is if media companies want to build platforms that last, they must stay laser focused on the “why” and “for whom” and avoid three dangerous mistakes:
1. Digital Déjà Vu: Lessons Learned on Consumer Desire
The streaming gold rush of the last several years is reminiscent of digital media’s big “pivot to video,” when companies abruptly overhauled their businesses to build video divisions because it appeared that was what advertisers and social media algorithms wanted.
Blinded by the promise of a new stream of digital dollars, media moved en masse to chasing distribution at the expense of demand. Brands that had no business launching into video were now bleeding capital to produce it. In doing so, they fell victim to big losses and layoffs — and lost sight of their consumer reason for being.
Back in 2012, the nascent stages of the pivot-to-video era, I came in to launch Condé Nast’s digital video business, a years-long investment that was always well considered in my mind because our voices and brands — from The New Yorker to Vanity Fair — had meant so much to readers for 100+ years.
We had a consumer reason for being, so even in a crowded video environment led by YouTube, we would just need to translate our authority and authenticity into audiovisual content that connected with both loyal readers and those who’d never subscribed to a magazine but knew the zeitgeist allure of Vogue and GQ.
While it took years of adaptation, the company’s digital brand extensions have transcended those hopes and continued to grow and scale. The same success can happen today, so long as emerging services have a similar patience and stay centered on their unique brand identity and audience needs.
2. Audience Building: ‘Content Is King’ Was Never More True
Stagnating subscriber growth is proving the internet doesn’t need another streamer. So forget the delivery mechanism, and ask what you are offering that fills a gap.
I don’t go to YouTube because I like watching short videos. I go because I like the content on building out my home garage gym — it fills a need for me that no one else does. In the same vein, I don’t need another streamer; I already subscribe to more than half a dozen. But live sporting-events platform Core Sports gives me “King of the Table” arm-wrestling showdowns, and I’m in. It’s the content I want, with the added benefit that it’s entertaining and convenient to watch via streaming.
I follow marketing strategist and veteran dot-commer Seth Godin, who advises that brands shoot for “minimum viable audience” — the smallest group that can sustain your business. Specificity should be key to choosing your customers.
Pinpointing this is the challenge for media companies. Those willing to experiment and iterate are the ones that will eventually get it right. But those chasing distribution just to deliver short-term dollars will face a far more challenging path.
Platform Technology: To Build or to Buy?
When companies don’t aim to satisfy consumer need, they end up addressing the wrong problem — say, trying to solve a technology issue that’s already been solved.
There’s nothing worse than a bad product experience: video buffering, subpar navigation, stale and repetitive recommendation algorithms. Media companies may be frustrated they can’t innovate fast enough and wind up losing revenue opportunities. They’ll often fall into the trap of spending millions to build proprietary streaming technology because that’s what Netflix did … 16 years ago.
Back in those Condé Nast days, we forged our digital strategy from the ground up, bringing in world-class engineers to build everything from a content management system (CMS) to our first proprietary data platform to drive that distribution model.
But the digital landscape today is drastically different. Technology has commoditized and become easier to outsource at a fraction of the price. “Proprietary” isn’t the differentiator it once was. Just this summer, Vox, who built its own CMS in the same era as Condé Nast, announced it would be switching to WordPress. Smart move.
While the expectations of content owners’ technology platforms should be nothing less than excellent, these are media companies, not tech companies. In a fragmented streaming landscape that’s scarce in resources, they must focus on what they do best: create world-class content.
All roads lead back to who the service is for. If media brands set off to launch a streaming platform in today’s market without this north star, they’re likely to see massive business consequences, if not downright failure.
Navigating the pitfalls of digital disruption requires commitment to carving out a niche founded on genuine need; distribution model and technology should always come second. As storytellers at heart, media companies must prioritize crafting compelling narratives and unparalleled programming tailored to their unique audience. This, and only this, is how they will not just survive but thrive in a competitive streaming landscape.
Fred Santarpia is a digital media and business transformation expert. He currently serves as president of Endeavor Streaming, where he spearheads the company’s global expansion strategy.
