OTT Subscriber Acquisition Strategies for a New RealityA PLAYBOOK FOR OTT BRANDS

Table of contents

Introduction: A New Reality 3

Opportunity from Uncertainty 6

01. Find Your Sweet Spots 10

02. Right Model, Right Time, Right Price 14

03. Innovate in Offers & Incentives 19

04. Engage, with Tailored Packages 25

05. Optimise Conversion 31

06. Measure & Optimise 36

In Conclusion: Innovation in Easy Reach 40

Introduction: A New Reality

“ In the post-pandemic world, there can be no standing still. OTT brands will need to constantly experiment and innovate in every aspect of the subscriber acquisition journey in response to diverse customer needs and rapidly changing behaviours, coupled with a demand for greater flexibility and choice.” - Paul Johnson, CEO, MPP Global

OT

T S

UB

SC

RIB

ER

AC

QU

ISIT

ION

ST

RA

TE

GIE

S F

OR

A N

EW

RE

AL

ITY

WW

W.M

PP

GL

OB

AL

.CO

M | 3

55%estimated global revenues growth

i. https://videomind.com/report-covid-19-pandemic-driving-global-ott-market-to-55-cagr-in-2020/

In among the gloom of a global pandemic, the rapid growth of OTT media subscriptions has sounded a rare positive effect – it is estimated that global revenues for the sector will grow by an unprecedented 55% in 2020i.With traditional pay-TV subscriptions and broadcast viewer numbers falling away, particularly in the US, it would be easy to reach the conclusion that COVID-19 lockdowns and stay-at-home orders have accelerated our arrival at the tipping point where on demand and OTT become the dominant models for video entertainment consumption.

The truth, however, is that the road ahead for OTT brands in an increasingly crowded and competitive market remains uncertain, with subscriber acquisition particularly challenging.

OT

T S

UB

SC

RIB

ER

AC

QU

ISIT

ION

ST

RA

TE

GIE

S F

OR

A N

EW

RE

AL

ITY

WW

W.M

PP

GL

OB

AL

.CO

M | 4

14%market growth

expected for 2021

Post Lock Down Churn

Most observers agree that the huge rise in OTT subscriptions gained during the height of the pandemic will go into reverse sooner or later, with changing circumstances and global economic turmoil likely to precipitate significant churn.

Consumers expect financial transparency,

a better customer experience, more

freedom and more choice

Raised Expectations

Ironically, OTT providers own willingness to adapt to customer needs during lockdown periods has raised customer expectations, which in turn inform buying decisions. Now, consumers expect financial transparency, a better customer experience, more freedom and more choiceii – and OTT brands will be forced to respond.

Slowing Subscriber Growth

After the rapid gains of 2020, the market is expected to stabilise in 2021, with growth dropping back to around 14%, though the ongoing impact of COVID-19 and lockdown measures remains to be seen. All the same, it is worth considering whether a return to more ‘normal’ levels of subscriber growth would be enough to counterbalance an inevitable erosion of recent gains, or whether OTT brands witness net shrinking subscriber bases in 2021?

Change the Only Constant

With the world still in the throes of a global pandemic consumer needs and behaviour will remain unpredictable, even at quite local levels, for some time to come. As a result, the days when a one-size-fits-all approach to subscriber acquisition are over. In this new reality, the ability to adapt quickly, to meet continuously shifting needs, will be a vital competitive lever.

ii. https://www.tvbeurope.com/media-consumption/subscriber-guilt-set-to-test-post-pandemic-ott-growth

OT

T S

UB

SC

RIB

ER

AC

QU

ISIT

ION

ST

RA

TE

GIE

S F

OR

A N

EW

RE

AL

ITY

WW

W.M

PP

GL

OB

AL

.CO

M | 5

Opportunity from UncertaintyThe net result is that subscriber acquisition is likely to be more important than ever in 2021. But also that subscribers themselves will represent a more demanding, constantly moving target.

For OTT brands that means acquiring the ability to innovate, experiment and adapt quickly – a capacity that has long been held back by everything from a lack of customer insight and inflexible business models to monolithic technology platforms that set limits on the pace of innovation.

That is, however, starting to change...

OT

T S

UB

SC

RIB

ER

AC

QU

ISIT

ION

ST

RA

TE

GIE

S F

OR

A N

EW

RE

AL

ITY

WW

W.M

PP

GL

OB

AL

.CO

M | 6

Broad Customer Insight

No-one yet knows whether the spike in new subscribers during lockdowns and stay-at-home orders will be temporary or convert into long term loyal customers. But aside from the obvious financial benefits whether short or long term, that subscriber growth also offers something potentially more valuable and enduring: Insight

New subscribers were drawn from every section of society, not just the traditional heartland of the 18-35s. In fact, some of the most significant growth was among older age groups, with around a third (32%) of 55-64 year olds and 15% of over-65s using subscription streaming servicesiii.

What’s more, it would be a mistake to assume those demographic changes are entirely transient – research from EY found 19% of households agreeing that the pandemic has irrevocably changed their viewing habitsiv.

As a result, OTT brands have the opportunity to attract and engage a much broader cross section of society, inevitably accompanied by diverse needs and behaviours – so success will depend on understanding and adapting to a broader set of demands.

The good news, for those brands able to convert data into action, is that subscriber growth during 2020 has provided the basis for hugely valuable customer data. Interrogating that data, to understand customer needs and behaviours can be the basis for multi-faceted, adaptable and, above all, effective subscriber acquisition strategies.

19%of households agreeing that the pandemic has

irrevocably changed their viewing habits

32%new growth in older

age groups

iii. https://www.ofcom.org.uk/about-ofcom/latest/media/media-releases/2020/lockdown-leads-to-surge-in-tv-screen-time-and-streamingiv. https://www.ey.com/en_uk/tmt/covid-19-quickening-the-pace-of-change-in-media

OT

T S

UB

SC

RIB

ER

AC

QU

ISIT

ION

ST

RA

TE

GIE

S F

OR

A N

EW

RE

AL

ITY

WW

W.M

PP

GL

OB

AL

.CO

M | 7

By allowing OTT brands to innovate and

experiment in every aspect of the subscriber

acquisition journey

Agile, Flexible Subscriber Management Platforms

The brands best placed to act on that insight, and the ability to keep pace with a constantly moving subscriber sweet spot will have a significant advantage – and the scale of that advantage will depend how far along the digital transformation journey they have travelled.Those still wrestling with monolithic legacy systems will struggle to keep pace with change – siloed data will hamper customer insight, while complex systems requiring technical resource will limit the ability to innovate, adapt and experiment in response to change.

On the other hand, a new breed of fully integrated cloud subscriber management platforms will provide forward thinking brands with all the flexibility and agility they need – and at lower cost. By allowing OTT brands to innovate and experiment in every aspect of the subscriber acquisition journey – in hours rather than months, and without the need for technical skills – they will offer a critical competitive advantage in the months and years to come, as we all adapt to a new reality.

Experiment and Innovate

This Playbook explores the opportunities for OTT brands to experiment and innovate at every stage of the subscriber acquisition journey – from the overarching subscription model to offers and incentives, subscription bundling, and the checkout experience.It draws on original thinking and real-world examples – to help OTT brands move towards the adaptable, customer-centric acquisition models that will be crucial not just to growth, but also to sustainable commercial success in this new reality.

Related Resources

WEBINAR: A year of disruption: What we have seen

WEBINAR: Sport is back: Lockdown lessons from digital media

OT

T S

UB

SC

RIB

ER

AC

QU

ISIT

ION

ST

RA

TE

GIE

S F

OR

A N

EW

RE

AL

ITY

WW

W.M

PP

GL

OB

AL

.CO

M | 8

01. Find Your Sweet Spots

KEY TAKEAWAYS:

Developing a customer-centric approach

Embracing innovation to elevate expectation

How customer insight can shape your strategy

OT

T S

UB

SC

RIB

ER

AC

QU

ISIT

ION

ST

RA

TE

GIE

S F

OR

A N

EW

RE

AL

ITY

WW

W.M

PP

GL

OB

AL

.CO

M | 9

Today, however...The market is a much more complex and diverse environment – home to hybrid or blended VOD models, evolving approaches to offers and incentives, and an increased focus on customer choice through segmented content bundling.

Let Deep Insight Enable Customer-centric Innovation

In a fast moving, competitive market where consumer needs, behaviours and demands are constantly shifting, the ability to differentiate is crucial. Clearly, content is king, but when it comes to subscriber acquisition there are myriad competitive levers to pull – in the overall VOD model, in offers and incentives, in subscription packaging and in the payment experience.

Innovation in the subscriber journey, then, can play a crucial role in accelerating and optimising customer acquisition, and this has not gone unnoticed. Three years ago, for instance, the market was pretty homogenous, with brands largely opting for an all you can eat (SVOD), pay-per view (TVOD) or advertising supported (AVOD) model and the 30-day free trial approach to offers and incentives.

OT

T S

UB

SC

RIB

ER

AC

QU

ISIT

ION

ST

RA

TE

GIE

S F

OR

A N

EW

RE

AL

ITY

WW

W.M

PP

GL

OB

AL

.CO

M | 10

Customer-centric ApproachQuite simply that is because the focus now is less on operational questions around how best to monetise content, and more on customer-centric considerations – how to attract, engage and ultimately convert visitors into loyal subscribers.

Clearly, however, customer-centricity depends on deep understanding of customer needs and behaviours; a rapidly changing set of considerations shaped by everything from age, location and demographics, to individual interests and content tastes. In turn, that means there is simply no one size fits all approach to subscriber acquisition, and the ability to adapt to meet changing customer needs is driving more and more decisions around the precise nature of acquisition campaigns.

Innovation Elevates ExpectationMake no mistake, the innovation imperative in the OTT market is here to stay. That’s because every innovation that truly delivers value against customer needs – whether for choice, transparency, convenience or anything else – immediately elevates customer expectations, and brands failing to meet those expectations will see a direct impact on commercial performance.

It also means brands adopting flexible, unified subscriber lifetime management platform are best placed to win the battle for subscribers – because the technical skills, complexity, speed to market and cost barriers to innovation are greatly reduced.

Brands failing to meet those [customer]

expectations will see a direct impact

on commercial performance

OT

T S

UB

SC

RIB

ER

AC

QU

ISIT

ION

ST

RA

TE

GIE

S F

OR

A N

EW

RE

AL

ITY

WW

W.M

PP

GL

OB

AL

.CO

M | 11

Pre-integrated Behavioural InsightFortunately, there are ways to short cut this process, calling on profiling, personalisation and segmentation tools like mtribes from Deltatre*.

Which makes it easy to

“ …identify and organise end users into different ‘Tribes’ that characterise the different audience segments that are using the platform, taking into account their interests, demographics and behaviours to guide decision-making.”

For OTT brands, the ability to call on pre-integrated subscription lifecycle and personalisation platforms, could represent a significant competitive advantage. Together, they can deliver a 360° view of subscriber acquisition data, updated in real-time, to enable faster, better decision-making and underpin highly-targeted, adaptable subscriber acquisition strategies – targeting the right people, in the right places, at the right time to maximise customer

Let Customer Insight Shape EverythingBut before we get to the detail it is vital to understand just how brands can use customer insight to shape every aspect of their acquisition campaigns.

It might seem counter intuitive, but that starts with insight around existing subscribers – and it also means striking a balance between commercial insight and behavioural insight.

That is, deep analysis of customer data can help to identify high value customer segments – those with high average revenue per user (ARPU) and customer lifetime value (CLV). But truly finding the sweet spot (or sweet spots) for subscriber acquisition means enriching that insight with detailed analysis of customer context and behaviour – not just regional and local variations, but also how they discovered the service, the offers they engaged with, the subscription options they chose, how they pay, the content they consume, how often and when, and so on.

This rich insight can help to guide everything from acquisition campaign targeting to decisions and innovation across consumption models, offers, bundling and payment – the entire acquisition journey in fact.

Related Resources

GUIDE: Audience segmentation strategies

WEBINAR: Turning data into actionable insight

* https://mtribes.com/

OT

T S

UB

SC

RIB

ER

AC

QU

ISIT

ION

ST

RA

TE

GIE

S F

OR

A N

EW

RE

AL

ITY

WW

W.M

PP

GL

OB

AL

.CO

M | 12

02. Right Model, Right Time, Right Price

KEY TAKEAWAYS:

One size does not fit all – deploy new models, quickly

How to innovate and adapt models

Work seamlessly with distribution partners

OT

T S

UB

SC

RIB

ER

AC

QU

ISIT

ION

ST

RA

TE

GIE

S F

OR

A N

EW

RE

AL

ITY

WW

W.M

PP

GL

OB

AL

.CO

M | 13

Strike the Right Balance between ARPU and Customer Experience

It would be easy to think that the choice of Video on Demand (VOD) model is purely a commercial one, a binary choice between a subscription-based model and an advertising-supported model. After all, they are the dominant approaches amongst the world’s largest OTT brands, from Netflix to Amazon and YouTube.

But scratch the surface, and even those market leading brands are not reliant on a single, unchanging approach. All offer customers a level of choice – Netflix’ Subscription Video on Demand (SVOD) model incorporates a choice of video quality and concurrent streams, Amazon couples its SVOD model with an element of pay-as-you-go or Transactional Video on Demand (TVOD), and YouTube offers the ad free subscription service, YouTube Premium.

The truth is, the choice of VOD model is always a trade-off. It is about finding the right balance between commercial KPIs like ARPU and CLV, and creating a sense of value amongst customers. That means looking not just at what they pay and how VOD services are delivered, but the customer experience too – from convenience and choice to individual needs and preferences.

All those insights should inform decisions around the VOD model, but that decision is not a one-shot deal. In such a fast-moving market, the successful brands will be those able to adapt and innovate, even at this high level.

There is NO Single AnswerThere can be no doubt that SVOD has proven hugely successful for the big brands – witness the stellar success of Disney+ for instance. However maximising income, whichever way brands go, is all about eyeballs and for brands without access to differentiated content a single, static model is simply not enough.

These brands must do more to engage consumers on their terms – and that means both choosing the right models for different territories, and innovating the model to generate wider appeal.

All this of course requires flexibility, agility and speed, which is increasingly available to OTT brands via cloud-based subscriber management platforms. These platforms enable media brands to deploy and iterate one or more business models by centralising product catalogues, promotions, customers, data, entitlements/fulfilments and billing, while offering simple, GUI-based configuration and instant deployment.

Find the right balance between commercial KPIs

like ARPU and CLV

OT

T S

UB

SC

RIB

ER

AC

QU

ISIT

ION

ST

RA

TE

GIE

S F

OR

A N

EW

RE

AL

ITY

WW

W.M

PP

GL

OB

AL

.CO

M | 14

Deploy New Models QuicklyThe days when deploying a new VOD model represented a significant investment – requiring development skills to build and customise the proposition, then integrate with everything from catalogues and permission management, to customer data and billing – are over.

Now, no technical skills are required. A centralised, pre-integrated platform removes the need for expensive, time-consuming development work. Instead, check-box configuration and intuitive rule management allows brands to deploy and switch between closely tailored models quickly and easily.

In Action: ITVHub+

When ITV launched its ad-free SVOD service, ITVHub+, alongside its more traditional AVOD services, ITV Hub, the motivation was clear. This was a move shaped by the desire to drive growth in OTT subscribers, and ITV took a customer centric approach, which meant offering choices based on different viewing preferences.

As Paul Kanareck, ITV’s group director of online, put itv :

“ Viewers have always understood the trade-off between paying to view content and watching adverts. With the development of the ITV Hub, we can now offer viewers a choice – to keep watching for free, or to pay to watch without interruptions if that’s important to them.”

If there are any doubts about the benefits of this approach, the numbers tell their own story. ITV’s trading statement in March 2020 revealed that ITVHub+ had so far attracted more than 400,000 subscribers and was enjoying growth of over 50% year-on-year. What’s more, it had not significantly affected the performance of its original Advertising Video on Demand (AVOD) service, which saw viewing rise by 13% in the same periodvi.

v. https://www.campaignlive.co.uk/article/itv-launches-ad-free-subscription-service-itv-hub/1418146vi. https://www.prolificnorth.co.uk/news/broadcasting-news/2020/03/itv-aims-become-more-tv-it-releases-annual-results

400k subscribers

attracted

50% year-on-year

growth

OT

T S

UB

SC

RIB

ER

AC

QU

ISIT

ION

ST

RA

TE

GIE

S F

OR

A N

EW

RE

AL

ITY

WW

W.M

PP

GL

OB

AL

.CO

M | 15

Innovate and Adapt the ModelAttracting more customers into the subscriber acquisition funnel is not just about choosing the right model or offering a choice of consumption models. It is also about offering choices that meet customer needs within individual models, for instance expanding subscription options and pricing to include a choice of video and/or audio quality, concurrent streams, or connected devices.

Again, a platform that enables brands to deliver this kind of innovation quickly offers a significant advantage.

In Action: NOW TV BoostWhen NOW TV launched NOW TV Boost, it directly addressed a consumer demand for greater choice in terms of viewing quality and concurrent streams. The Boost package gives the option of Full HD 1080p streaming, 5.1 Dolby Digital audio, the ability to watch three streams simultaneously, and 50fps video streaming on selected devices.

In effect, the move widened the appeal of NOW TV, especially for customers for whom viewing quality is an important consideration.

Marina Storti, NOW TV’s managing director, explained:

“ NOW TV Boost is an important step in offering our customers a higher quality viewing experience.”

Early results look promising, with the proposition meeting expectations in term of revenue benefits, with sales of around 3,000 passes a dayvii.

Hybrid and Blended ModelsContent remains king when it comes to subscriber acquisition, but the ability to be flexible in using high value, premium content to attract new subscribers is also an important competitive lever. For instance, extending a standard SVOD model, by adding standalone options to access premium content is a great way to drive new revenue, but also enable one-time users to experience and explore the service while gathering data to feed into wider acquisition campaigns.

In Action: Disney+ and MulanClearly there were other factors involved in Disney’s decision to release Mulan as a Premium Video on Demand (PVOD) offering alongside, and integrated with, its Disney+ SVOD proposition – the unavailability of its traditional theatrical platform being chief among them.

However, the ability to take this hybrid approach, and the benefits it can accrue should not be overlooked. For instance, the launch of Mulan coincided with a 68% spike in Disney+ app downloads, and 193% growth in ‘in-app’ spending over the same periodviii.

Whichever way you cut it, that all equates to a lot of extra revenue and, at the very least, a lot of new customer data to feed into Disney+ subscriber acquisition campaigns.

vii. https://www.moorhouseconsulting.com/insights/case-studies/sky-now-tv-boost/viii. https://finance.yahoo.com/news/nearly-onethird-of-us-households-purchased-mulan-on-disney-for-30-fee-data-221410961.html

3k passes sold

dailyvi

68% spike in Disney+ app downloads

OT

T S

UB

SC

RIB

ER

AC

QU

ISIT

ION

ST

RA

TE

GIE

S F

OR

A N

EW

RE

AL

ITY

WW

W.M

PP

GL

OB

AL

.CO

M | 16

Work Seamlessly with Distribution PartnersWhether an OTT provider is seeking to enter a new territory or simply to extend subscriber acquisition reach in existing markets, the partner channel is becoming more and more important. That could include pre-programmed, one-click access via Smart TV remotes, distribution via broadband providers seeking to add value to their services, or via app stores – but in all cases, the ability to seamlessly integrate a recognisable brand experience within that channel distribution is vital.

Today, it is possible to leverage the reach of channel partners and get to market quickly, without the need for time-consuming development work. Cloud subscriber management platforms offering extensive API libraries streamline these integrations across everything from registration and entitlement to payment – to open up a wealth of opportunity to extend subscriber acquisition reach.

In Focus: CPA Versus RPUWorking with distribution partners brings the obvious upsides of extended reach and lower cost per acquisition (CPA) but there is a trade-off. That is, partner-acquired subscribers will deliver lower average revenue per user (ARPU), while the partner will ‘own’ the customer data and the OTT brand will have less control over the customer experience.

As a result, it is important when embarking on a partner distribution strategy to consider how customers can be migrated across to a direct relationship over time – to increase ARPU and access the full range of customer data. That might, for instance mean doing time-limited commercial deals with distribution partners and/or incentivising channel subscribers to go direct with vouchers and offers.

Respond to Regional Needs and PreferencesThe open internet may be universal, but OTT is not: Maximising subscriber acquisition and revenue across different territories means adapting to local customer needs and preferences. That in turn makes the ability to quickly deploy different models in different territories, without ending up with a complex, disconnected mish-mash of infrastructure and data is vital – something that brands still operating on-premise, legacy platforms struggle with.

Meanwhile centralised and extensible cloud platforms enable media brands to deploy and iterate the right business models to entice global audiences wherever they are, without the need to build or customise infrastructure – and with all subscriber data collected, processed and stored centrally.

Today, it is possible to leverage the reach of channel partners and

get

Related Resources

WEBINAR: Pricing for success: Innovative business models for OTT

CASE STUDY: OTT strategies for football clubs

OT

T S

UB

SC

RIB

ER

AC

QU

ISIT

ION

ST

RA

TE

GIE

S F

OR

A N

EW

RE

AL

ITY

WW

W.M

PP

GL

OB

AL

.CO

M | 17

03. Innovate in Offers & Incentives

KEY TAKEAWAYS:

Attract and engage subscribers on their own terms

The value exchange: Free trials and near-free trials

Personalising offers and vouchers

OT

T S

UB

SC

RIB

ER

AC

QU

ISIT

ION

ST

RA

TE

GIE

S F

OR

A N

EW

RE

AL

ITY

WW

W.M

PP

GL

OB

AL

.CO

M | 18

Expand the Funnel. Enable Multiple Entry Points

The days of the 30-day free trial as the ‘go to’ strategy are all but over. So called ‘free trial abuse’ and eroding conversion rates have seen most OTT brands shorten trial periods – typically offering seven or 14-day trials coupled with offers and incentives to heighten consumer desire and drive up free trial conversion rates.That is all well and good, but those are commercially driven decisions designed to accelerate the funnel by forcing potential customers to either pay up or leave. What’s more, it is essentially a one-size fits all approach that takes no account of the sheer range of customer preference. The days of the

30-day free trial as the ‘go to’ strategy

are all but over.

7 or 14-day trials coupled with offers heighten consumer

desire

OT

T S

UB

SC

RIB

ER

AC

QU

ISIT

ION

ST

RA

TE

GIE

S F

OR

A N

EW

RE

AL

ITY

WW

W.M

PP

GL

OB

AL

.CO

M | 19

Attract and Engage Subscribers on their Own TermsThe real opportunity to innovate in offers and incentives is again to take a customer-centric approach – which means finding new ways to attract and engage more subscribers on their own terms. That starts with an understanding of customer needs.

But it also requires a change in mind set. Trial periods can meet those customer needs, but they don’t have to be passive – forward thinking brands are already starting to see them as value exchanges in which consumers are given the chance to try before they buy, and providers get some value in return. That could be data to enable personalised engagement marketing, offers and vouchers during a trial period, or it could be a nominal subscription fee.

The good news is that cloud subscriber management platforms enable OTT brands to embrace this mindset, deploying a range of different trial models accompanied by a vast array of vouchers and offers using a range of approaches. That could be tailored offers shaped by trial period activity, offers bundling ancillary or third-party products and services, or simply time-restricted offers designed to create urgency.

In truth options are almost limitless, so there is a big opportunity for brands to experiment, test and evolve – to ultimately offer multiple entry points to the subscription journey, while continuously differentiating and driving customer consideration through fresh new vouchers and offers.

Road test Try out VOD services before they commit, to assess quality and performance, and the overall user experience.

Check for relevanceBrowse content listings to assess the level and quality of content that fits their own interests and viewing habits.

Clearly, the chance to consume content for free is attractive but before they commit to a subscription, consumers’ underlying needs are to:

Enabling OTT brands to deploy a range of different trial models

accompanied by a vast array of vouchers and offers using a range of

approaches

OT

T S

UB

SC

RIB

ER

AC

QU

ISIT

ION

ST

RA

TE

GIE

S F

OR

A N

EW

RE

AL

ITY

WW

W.M

PP

GL

OB

AL

.CO

M | 2

0

Free Trials, Near-free Trials and Value ExchangesNetflix may have announced the end of the free trialix, but in this new customer-centric reality it may still have a role to play – as the basis for a value exchange with potential subscribers. That is, free trials in return for data.

That could take many forms but, in essence would involve users giving over more data in exchange for more access.

In Action: NOW TV

NOW TV is a market leader when it comes to experimenting with offers and incentives, its flexible and agile subscriber platform enabling it to pushing out hundreds of different treatments every year – for instance innovating with free trial periods and low cost incentives, but always measuring and learning from the performance of each.

Combined with tools to prevent trial abuse, these approaches would enable potential subscribers to ‘try before they buy’, while giving OTT brands the data and insight they need. Together with content consumption insight from trial periods, this will enable brands to deliver personalised offers and incentives and remove a key barrier to conversion because payment details have already been provided.

Examples:

Short trial periods with the option to extend by 24 hours at a time in exchange for useful data or actions – that could be filling out surveys and signing up to newsletters right through to providing payment details for pre-authorisation.

Offering trial periods at vastly reduced subscription rates – £1 per day for instance.

ix. https://www.msn.com/en-gb/money/technology/netflix-stops-offering-free-trials-as-it-looks-for-new-ways-to-make-people-sign-up/ar-BB1a05PO?ocid=msedgdhp

OT

T S

UB

SC

RIB

ER

AC

QU

ISIT

ION

ST

RA

TE

GIE

S F

OR

A N

EW

RE

AL

ITY

WW

W.M

PP

GL

OB

AL

.CO

M | 2

1

Content MeteringPrevalent in publishing, content metering in its basic form, allows non-subscribers to consume a pre-determined number of content assets for free before being presented with the requirement to register, subscribe, or pay for one-off access. There is, however, no reason why this approach could not be applied successfully in the OTT market.

For instance, allowing registered trialists to browse content, but metering content consumption has the benefit of allowing potential subscribers to try before they buy, enabling brands to gather user data, and creating a purchase imperative when trialists want to see more.

Content metering can also be deployed as a value exchange mechanism. For instance, allowing first episode viewing for free, but as with trials, requiring progressively more data and action from users to unlock further episodes, before finally requiring a subscription to continue.

In Action: Netflix

Recent Netflix updates suggest the brand is moving towards a content metering model as it seeks to break through a subscriber growth plateau by experimenting with new ways to attract and engage customersx.

Specifically, users in the US are now able to watch selected content without a subscription. They include Stranger Things, Murder Mystery, Elite, Bird Box, When They See Us, The Two Popes, Our Planet and Grace and Frankie, but users are restricted to watching only the first episode for free.

We can expect further experimentation on this front given the company has already confirmed the move is part of a focus on

“…looking at different marketing promotions to attract new members and give them a great Netflix experience.”

x. https://www.independent.co.uk/life-style/gadgets-and-tech/news/netflix-free-to-watch-how-subscribe-iphone-apple-original-a9698526.html

Content metering could be applied

successfully in the OTT market

OT

T S

UB

SC

RIB

ER

AC

QU

ISIT

ION

ST

RA

TE

GIE

S F

OR

A N

EW

RE

AL

ITY

WW

W.M

PP

GL

OB

AL

.CO

M | 2

2

Personalised Offers and VouchersFlexible, agile subscriber platforms provide OTT brands with huge scope to experiment, test and innovate when it comes to offers and vouchers – thanks to easy configuration, instant deployment and, combined with rich customer data, the opportunity to tailor to different territories and even personalise according to viewing habits.

Critical to success here are the abilities to meet different customer needs, enable subscriber self-service and differentiate through relevant, fresh offers – while avoiding subscriber cannibalisation by ensuring they can be redeemed only by new users.

Innovative offer types might include:

Personalised offers: Drawing on individual behaviour, context or preference to automatically generate ‘unique, single use’ vouchers and offers.

Time-limited offers: Creating urgency by serving up vouchers and offers that must be redeemed within as certain timeframe.

Bundle vouchers: To be distributed with channel partner devices, marketplaces or customer communication.

Affinity vouchers: Combining OTT subscription offers with discounted or exclusive offers from relevant third-party organisations.

Add-credit vouchers: Enabling consumers to earn ‘rewards’ in the form of free credits if they perform a certain activity – for instance receiving free credits in return for sharing offers and incentives with friends or on social media immediately after subscribing.

In Focus: Test and Learn

The truth is that it is impossible to accurately predict the success of any one offer, incentive or voucher, so the ability to deploy instantly, measure, test and iterate is vital to optimising OTT brands’ offer activity.

MPP Global clients have the ability to create hundreds of offers every year, without technical expertise, to measure their impact, tweak and A/B test as they seek to identify and optimise high performing approaches.

Related Resources

WEBINAR: Grow OTT revenues: Maximise conversions & minimise churn

WHITEPAPER: How media companies can make the most of Black Friday

In Action: Affinity vouchers are proven engage and drive conversion

OT

T S

UB

SC

RIB

ER

AC

QU

ISIT

ION

ST

RA

TE

GIE

S F

OR

A N

EW

RE

AL

ITY

WW

W.M

PP

GL

OB

AL

.CO

M | 2

3

04. Engage, with Tailored Packages

KEY TAKEAWAYS:

A hotbed of innovation & choice

Customer-centric bundles & personalisation

Building transparency & trust

OT

T S

UB

SC

RIB

ER

AC

QU

ISIT

ION

ST

RA

TE

GIE

S F

OR

A N

EW

RE

AL

ITY

WW

W.M

PP

GL

OB

AL

.CO

M | 2

4

Focus on Customer Needs, Choice and Value

By the time consumers reach this stage of the journey, when they are open to browse subscription options – having navigated trials, offers and incentives – the majority will either do so with a genuine purchase intent or are willing to be persuaded. But all that work to attract and engage will be undone if those potential subscribers do not immediately perceive value and relevance in the options presented to them.

This is not just about price – though pricing to convert is a crucial lever. It is, once again, also about taking a customer-centric approach by demonstrating financial transparency and offering meaningful subscription choices shaped by customer need.

Put simply, the aim when it comes to innovating subscription bundles is to put the customer first – make it simple and easy to subscribe based on individual perceptions of value.

Hotbed of InnovationGiven that this is the final hurdle in the acquisition journey, when customers must start to think about parting with money, it should come as no surprise to learn that subscription bundling and unbundling has been a major focus of innovation for OTT brands in recent years.

The crucial factors enabling effective innovation in subscription packaging, however, are speed and flexibility, plus the ability to test, learn and adapt quickly – and this is where OTT brands still using legacy, and often siloed subscription environments, may struggle. The need for technical and developer input raises the cost and narrows the scope of innovation, while a lack of centralisation makes dealing with issues like varying tax rates in a single basket difficult or impossible to handle.

In short, these brands see the value of innovation here, but are hamstrung by a lack of capability.

On the other hand, subscriber management platforms that unify product catalogues, bundling and payment in a single, adaptable environment offer exactly the flexibility required to capitalise on purchase intent by offering customers the flexibility and choice they demand.

Put the customer first – make it simple and

easy to subscribe based on individual

perceptions of value.

OT

T S

UB

SC

RIB

ER

AC

QU

ISIT

ION

ST

RA

TE

GIE

S F

OR

A N

EW

RE

AL

ITY

WW

W.M

PP

GL

OB

AL

.CO

M | 2

5

The options here include:

User-defined bundles Individually priced bundles for film, comedy series, documentaries, sports and so on – with users able to self-select the bundle or bundles most relevant to their tastes

Pre-defined bundles Cloud platforms enable OTTs to generate a wide range of pre-defined tailored bundles – to offer subscribers more relevant choices, since passes are shaped by insight around user behaviour and content consumption trends.

Personalised BundlesOTT brands have already realised that ‘all you can eat’ package, offering access to all content types and genres for a fixed price, is the opposite of a customer-centric approach and have started to segment content into discrete bundles according to subscriber interest.

After all, it is self-evident that a potential subscriber with an interest in sitcoms will perceive greater value in a segmented subscription focused on or around that individual preference and at a lower price than they will a bundle offering films, sports, thrillers, documentaries and so on, at four or five times the price. That remains true even when that lower price is actually higher than the equivalent portion of an ‘all you can eat’ subscription.

These approaches are the epitome of customer-centricity balanced with commercial sense. The subscriber gets value, a relevant experience and a sense of control, while the OTT brand accelerates acquisition and immediately has an opportunity to cross-sell or up-sell further content passes – driving up ARPU overall.

In Action: NOW TV

NOW TV has decoupled and segmented all its content types (kids, movies, entertainment, sport, and so on) for a number of reasons – it helps increase acquisition due to lower price points compared with all you can eat – but also for retention purposes because when someone cancels a pass, it’s not for everything – just that product.

In Action: Segmented bundles strengthen conversion by creating a sense of relevance and value.

OT

T S

UB

SC

RIB

ER

AC

QU

ISIT

ION

ST

RA

TE

GIE

S F

OR

A N

EW

RE

AL

ITY

WW

W.M

PP

GL

OB

AL

.CO

M | 2

6

Rapid PersonalisationOTT brands able to call on the power of pre-integrated subscriber lifetime platforms and personalisation tools like mtribes from Deltatre* can go further – drawing on a single, integrated view of behavioural, conversion and consumption data to hyper-target acquisition efforts according to consumer audience segments or ‘Tribes’.

They can use that rich insight, coupled with simple, non-technical tools to personalise everything from the user experience and content recommendations to subscription packages – measuring, adapting and optimising every area in real time – to dramatically improve the effectiveness of acquisition activity.

In Focus: Fragmented OTT Audiences – Football Fans

There are enormous benefits to employing subscription and personalisation platforms in tandem, and sports OTT offers a prime example. Sports clubs in particular, typically have fragmented, global audiences – speaking various languages, using different currencies and payment methods, viewing content of different devices, and subject to a wide variety of behavioural and cultural nuances.

This is where the power of rapid personalisation really shines. It enables sports service providers to segment fragmented audiences into any number of discrete ‘Tribes’ – whether by league, club, favourite players, device, and so on – or a combination of these characteristics. In turn, the segmented insight this delivers can enable sports service providers to closely tailor everything from the UX to packages – delivering a more personal, convenient and satisfying customer experience and driving up conversion rates.

For example, an ‘Apple Device’ segment could enable OTT brands and sports service providers to serve up packages tailored to Apple device users – including offering Apple Pay as the preferred payment method to reduce drop offs and increase subscriber conversion.

Enabling sports service providers to

segment fragmented audiences into any number of discrete

‘Tribes’

* https://mtribes.com/

OT

T S

UB

SC

RIB

ER

AC

QU

ISIT

ION

ST

RA

TE

GIE

S F

OR

A N

EW

RE

AL

ITY

WW

W.M

PP

GL

OB

AL

.CO

M | 2

7

In Action: YouTV

Danish cable operator YouSee has launched YouTV, a streaming service that aggregates third-party TV channels and other streaming offerings in a single app that can be accessed on any network. Users will be able to build their own bundles, ‘spending’ points to choose from an à la carte offering that mixes linear channels and streaming services.

Commenting on the move Jacob Mortensen, CEO of YouSee, was clear that this innovation is driven by a customer-centric approach and a desire to respond effectively to changing customer needs:

“ Today, many Danes prefer to watch their entertainment through various streaming apps instead of a traditional TV package. That is why we have designed a flexible TV and streaming service, YouTV, for precisely these users.

“ This is the first time it will be possible in Denmark that, no matter where you live or stay, you simply have to download an app and then immediately freely choose between the most preferred TV channels and streaming services in a holistic, simple and flexible way.”

Event-based PassesOn the other hand, some subscribers may only be interested in a specific event, movie, or series. Should OTT brands force these customers to take out and cancel full subscriptions, just to get access to that specific content? Clearly, this is not the way to demonstrate value or build trust.

Rather, enabling those customers to buy passes for specific events or content pieces has the benefit of on-boarding subscribers on their own terms, with the after-sales focus on engagement and up-sell – for instance through trials, discounts and vouchers – to convert that one time subscription into a longer term relationship.

Value-added BundlesAdding discounted or value-added extras to content bundles is also a great way to elevate customer perceptions around the value of specific subscription options. For instance, a sports business offering OTT match passes might choose to add a physical match programme or other merchandise to the bundle – either discounted or free and sent to the customer’s home address.

There are, however, some complications associated with this approach that may push it out of reach for brands still relying on legacy technology. For instance, digital and physical products may require different tax treatments, while brands may on occasion need to process refunds for individual products bought as part of multi-product bundle and with their own discounts applied – and legacy platforms don’t typically make these issues easy to deal with.

OT

T S

UB

SC

RIB

ER

AC

QU

ISIT

ION

ST

RA

TE

GIE

S F

OR

A N

EW

RE

AL

ITY

WW

W.M

PP

GL

OB

AL

.CO

M | 2

8

Affinity BundlesSimilarly, there is huge value in the idea of multi-brand bundling, which would involve working with affinity partners to bundle discounted third-party products and services with OTT subscriptions or passes. The right bundle, bringing together compatible products and subscriptions, significantly increases the perceived value of the overall offer – to accelerate subscriber acquisition while strengthening commercial partnerships.

This approach is, however, subject to the same issues as value-added bundling, with the added complication of having to integrate with third party product, payment and fulfilment systems – something that is very difficult to do without the flexibility and simple integrations offered by cloud subscriber platforms.

Transparency and TrustOne final barrier that can prevent customers from acting on purchase intent at this stage is a lack of transparency. Customers want to feel in control, not locked in by impenetrable terms and conditions.

It is, therefore, vital to build trust by being open and transparent about:

Pricing For instance, including a fixed-term, fixed price guarantee gives customers the confidence to buy, secure in the knowledge that they won’t be hit with price hikes once they have signed up.

Unbundling Enabling customers to create their own subscription packages by selecting individual genre or format bundles is one thing, but it must be a two-way street. It is, therefore, important to make clear to customers how and when they can adapt those personalised subscriptions, for instance by removing specific bundles from their account.

CancellationIt may seem counter-intuitive but giving customers clarity around how they can go about reducing or cancelling subscriptions if their circumstances change knocks down another potential purchase objection. Including brief information both at sign up and in welcome emails is a simple way to achieve this. Netflix’ ‘Watch Anywhere. Cancel Any Time’ messaging is a good example of this.

Related Resources

CASE STUDY: Launching an OTT video service with Europe’s largest pay-TV operator

WHITEPAPER: Highly effective pricing strategies for the media sector

In Action: NOW TV uses affinity bundling to great effect – but the choice of partner offer is crucial to delivering relevant, attractive offers.

OT

T S

UB

SC

RIB

ER

AC

QU

ISIT

ION

ST

RA

TE

GIE

S F

OR

A N

EW

RE

AL

ITY

WW

W.M

PP

GL

OB

AL

.CO

M | 2

9

05. Optimise Conversion

KEY TAKEAWAYS:

Offer easy, relevant payment options

Adapt to local audiences

Delivering a slick checkout experience

OT

T S

UB

SC

RIB

ER

AC

QU

ISIT

ION

ST

RA

TE

GIE

S F

OR

A N

EW

RE

AL

ITY

WW

W.M

PP

GL

OB

AL

.CO

M | 3

0

Remove Payment Friction Everywhere

All that innovation will be for nothing if OTT brands do not work harder to remove barriers at the final, crucial stage of the subscriber journey – the checkout.That means delivering a frictionless, streamlined and easy payment experience tailored to local markets and offering a selection of convenient payments options.

However, alongside UX and convenience considerations, as well as compliance, there are also commercial issues to take into account – for instance the 30% revenue cut that both Apple and Google take from their native app store payment systems. Admittedly, that cut falls to 15% in year two, but there will still be an impact on ARPU, so there is a judgement to be made around the trade-off between frictionless convenience for subscribers and commercials.

OT

T S

UB

SC

RIB

ER

AC

QU

ISIT

ION

ST

RA

TE

GIE

S F

OR

A N

EW

RE

AL

ITY

WW

W.M

PP

GL

OB

AL

.CO

M | 3

1

The huge range of options breaks down across a number of broad categories, each with their pros and cons, including:

Direct Debit (or SEPA in the Eurozone): Given that customers rarely change their bank accounts, this is the stickiest payment type, but comes with several drawbacks depending on the territory. There is the obvious, elongated customer journey, and a processing time of up to four days along with the relative expense of payment retries for failed payments, compared with credit cards.

Credit/Debit Cards: A much more convenient payment method offering a simplified journey over direct debit, but around 30% of credit cards will expire during a yearlong subscription, which inevitably pushes up involuntary churn rates. Meanwhile, credit cards are less widely used in some markets, many of which are prime expansion targets for OTT brands.

eWallets, or Mobile Wallets: It is widely predicted that eWallets like Apple Pay, Google Pay and Alipay will be the preferred payment methods worldwide by 2021 – a trend that is likely to be accelerated by the preference for contactless payment during the COVID-19 pandemic. So this is clearly an option that OTT brands cannot ignore, despite operators taking up to 30% of subscription revenues in year one and 15% thereafter.

Carrier Billing: More popular in APAC markets, this method sees subscription payments processed through mobile providers – with subscription fees added to mobile phone bills. As with eWallets, carrier billing offers a low friction payment experience and relatively high conversion rates but is subject to a revenue share with mobile providers and may require complex integrations with telco systems.

In-app Purchases: Enabling consumers to access and purchase content through App Stores such as Apple iTunes, Google Play, Amazon and Roku has become an effective strategy to reach enormous volumes of potential subscribers. However, there is a ‘cost of doing business’ trade-off between access to mass audiences, in return for a 30% commission levied on all transactions and less control over the customer identity. Nevertheless, IAP provides a lucrative cross-platform acquisition channel to access global audiences.

Buy Now, Pay Later: An emerging model, particularly in some Scandinavian counties – brands like Klarna essentially provide customers with a short-term credit facility – so they can buy now, pay later, or spread the cost of a subscription over a number of months.

Offer Easy, Relevant Payment OptionsThese days, OTT brands can draw on a huge wealth of payment schemes – more than 300 worldwide – but giving customers payment options at checkout is only part of the answer. Offering the right number of options and recognising that different customers have different needs – from trusted methods to convenience – is just as important.

300payment schemes

worldwide

However, there is a lot more to getting the payment experience right than simply looking to balance commercials with convenience.

OT

T S

UB

SC

RIB

ER

AC

QU

ISIT

ION

ST

RA

TE

GIE

S F

OR

A N

EW

RE

AL

ITY

WW

W.M

PP

GL

OB

AL

.CO

M | 3

2

Local Relevance

Particularly for brands operating in multiple territories, it is important to think locally and realise that what works for subscribers in one region doesn’t necessarily guarantee success in other markets. For example, many sports rights holders can generate traffic when launching in new territories, but often struggle to convert because they can only provide nominal payment options and a generic experience.

It is therefore vital to research preferred local services and make them available to local consumers as part of a slick checkout experience. That means looking at dominant payment methods – 85% market penetration is a good benchmark – but also at the full range of methods that customers trust in each market and ensuring that real time payment (think credit card versus direct debit) is at least among the options.

Be Ready to Adapt

Whichever mix of payment methods an OTT brand chooses to offer, it is important, to be able to adapt as local preferences change, or new payment methods emerge. However, for brands still operating on legacy platforms, adding new payment methods can be a lengthy and expensive process.

Those on modern, cloud platforms, however, can rely on vendors to enable payment services integrations across all the major providers worldwide – and to offer features enabling brands to quickly build, host and deploy new payment methods as they emerge.

Checkout Flow and UX

In the past, a subscription signup journey was typically a multi-page experience moving through account registration pages and payment, but this is starting to change as OTT brands realise a longer journey means more opportunity for customers to drop out of the process.

In response, there is a clear move to shorten the checkout journey, with innovations including:

Single page process: Using simplified registration and payment flows as well as innovative designed to compress the journey into a single page – a quicker, less demanding experience is highly effective at reducing basket abandonment. There is, however, a balance to be struck since a single page treatment does not capture customers dropping out between registration and payment, which hinders remarketing and checkout optimisation.

Payment first: Brands like Torstar in the US have reversed the checkout journey, to collect payment first, and registration details later – to better capitalise on purchase intent that can be eroded as customers work through the registration process. The ability to deliver this experience in the EU may, however, be compromised by tightening regulations around credit card payments (PSD2: SCA).

Read more about preferred payment methods worldwide, here.

85%market penetration

is a good benchmark

OT

T S

UB

SC

RIB

ER

AC

QU

ISIT

ION

ST

RA

TE

GIE

S F

OR

A N

EW

RE

AL

ITY

WW

W.M

PP

GL

OB

AL

.CO

M | 3

3

Constant Improvement: Deliver a Slick Checkout Experience

Clearly, this stage – where customers part with money – is the most important in the entire subscriber acquisition journey. A broken checkout experience can unhinge even the slickest of operations, so constant improvement, based on evidence, is crucially important.

Related Resources

GUIDE: Key payment & subscriber management insights for international broadcast media and OTT industries

WEBINAR: European payments: The omni-channel future

Basket abandonment – when users add to basket but fail to complete a purchase – is a clear indication of a poor checkout experience and a big issue for any business selling online. So, monitoring abandonment rates in detail is vital to identifying and removing friction from the payment journey – but every checkout is a journey in its own right so conversion versus abandonment is not just a binary measure.

Rather, OTT brands need to assess the entire registration to payment experience, treating every step as a ‘micro-conversion’ and using analytics to assess conversion rates at each. For instance, if 80% of traffic gets to a registration page, but only 20%

then move onto payment, it is clear where the problem is. But without monitoring these aspects, simple answers will remain hidden.

Finding those pain points on the journey, then combining that data insight with feedback from moderated user testing, will provide all the information brands need not just to identify issues, but to fix them in ways that meet customer needs and therefore improve overall conversion rates.

A broken checkout experience can unhinge even the slickest of

operations

OT

T S

UB

SC

RIB

ER

AC

QU

ISIT

ION

ST

RA

TE

GIE

S F

OR

A N

EW

RE

AL

ITY

WW

W.M

PP

GL

OB

AL

.CO

M | 3

4

06. Measure & Optimise

KEY TAKEAWAYS:

Unified, actionable insight

Commercial, strategic & tactical acquisition targeting

Closing the loop creates advantage

OT

T S

UB

SC

RIB

ER

AC

QU

ISIT

ION

ST

RA

TE

GIE

S F

OR

A N

EW

RE

AL

ITY

WW

W.M

PP

GL

OB

AL

.CO

M | 3

5

Experiment, Learn, Iterate

It hardly needs to be said, but innovation without measurement is nothing. Every innovation, every optimisation must be measured in detail to understand the impact on subscriber acquisition – unearthing actionable insight then using it to constantly adapt and optimise.But effective measurement relies on joined up systems and data, plus the ability to interrogate and visualise that data in useful ways. This necessity gives OTT brands further along the digital transformation journey a clear advantage.

Unified, Actionable InsightFor instance, cloud platforms like eSuite enable OTT brands to securely access, query, analyse, and visualise raw transactional and real-time subscription data, to generate the insights they need to inform strategic and day-to-day decision making around acquisition models and campaigns.

By putting such a wealth of data at OTT brands’ fingertips and making it easy to convert that data into insight they cut out the middleman, providing the instant business insight that enables those brands to:

Access all business, revenue & metering data in single, secure cloud repository.

Leverage terabits of real-time data to help respond to and scale consumer acquisition efforts with speed and agility.

Rapidly analyse acquisition, usage & retention trends.

Easily reconcile revenue to product sales, helping to report and advise on what’s selling, and what’s not.

Generate custom revenue reports and visualise real-time performance metrics.

Aggregate all data from all platforms into single visualisation tools.

That insight can, and should, be applied in a number of ways to help optimise acquisition performance.

Innovation without measurement

is nothing

OT

T S

UB

SC

RIB

ER

AC

QU

ISIT

ION

ST

RA

TE

GIE

S F

OR

A N

EW

RE

AL

ITY

WW

W.M

PP

GL

OB

AL

.CO

M | 3

6

Tactical: Campaign Performance

At the tactical level, it is important to measure every aspect of acquisition campaigns and customer journeys, to identify and double-down on high performing activities – but also to learn from those performing less well.

Clear, consistent metrics are obviously very important and modern platforms enable greater granularity here – not just looking at overall acquisition rates, but engagement with trials and offers, promotions and packages and, ultimately, which delivered the best results at each stage of the journey.

That granular insight typically uncovers a wealth of opportunity for further innovation and optimisation, either by A/B testing high performing tactics, or by further experimenting with (and constantly measuring) novel approaches.

Coupled with the ability to deploy and test new offers, promotions and packages quickly, this insight can significantly accelerate the pace of innovation while enabling brands to focus that innovation on the right areas.

Strategic: Acquisition Targeting

The Holy Grail of OTT acquisition campaigns is not simply to ‘fill the bucket’ but to attract and convert the right customers – quality, long term customers delivering higher ARPU. That longer term measurement, means segmenting new subscribers according to their purchase journey and tracking their behaviour over a much longer period – looking at spend, loyalty and so on – to identify trends in terms of how the highest performing groups were acquired:

Where they came from – where advertising spend is working.

The trials and offers they engaged with.

The packages they bought.

Whether spend increased over time.

Content and platform engagement trends to identify the likelihood of churn.

All that insight should then be fed back into acquisition campaign planning to ensure brands are targeting high value customers.

How to attract and convert the right customers

OT

T S

UB

SC

RIB

ER

AC

QU

ISIT

ION

ST

RA

TE

GIE

S F

OR

A N

EW

RE

AL

ITY

WW

W.M

PP

GL

OB

AL

.CO

M | 3

7

[(revenue per customer – direct expenses per customer) / (1 – customer retention rate)]

(number of customers acquired / direct marketing spending)

Closing the Loop Creates AdvantageAll these measures and more are vital to progressive improvement and optimisation – to enable focused, effective innovation in subscriber acquisition by closing the loop between experimentation and outcomes.

The brands best able to create and maintain this virtuous circle will garner significant and growing competitive advantage as a result.

Commercial: Value Versus Cost

Finally, the easy availability of detailed data enables OTT brands to constantly keep on top of crucial commercial metrics, continually assessing the effectiveness of acquisition campaigns overall.

One such measure is the lifetime value (LTV)/customer acquisition cost (CAC) ratioxi, which provides an instant overview of the impact of acquisition activity on commercial performance – and, provided data is easily available, is based on a relatively straightforward formula:

[£50 - £30 / (1 - 0.75)]

1000 / £10,000= 8

For example, a brand spends £10,000 to acquire 1000 new customers, average revenue per customer is £50, the direct costs of fulfilment are £30, and retention rates are running at 75%. Plugged into the LTV/CAC formula, those numbers give a score of 8:

Generally speaking, any score above 3 is considered a good score, and the higher it is, the better. Meanwhile a score of 1 or less means acquisition activity is either neutral or destroying commercial value.

Related Resources

GUIDE: Optimising your recurring card payments and reducing churn

GUIDE: OTT video services: A getting started guide

Enable focused, effective innovation

in subscriber acquisition

xi. https://corporatefinanceinstitute.com/resources/knowledge/valuation/cac-ltv-ratio/

OT

T S

UB

SC

RIB

ER

AC

QU

ISIT

ION

ST

RA

TE

GIE

S F

OR

A N

EW

RE

AL

ITY

WW

W.M

PP

GL

OB

AL

.CO

M | 3

8

In Conclusion: Innovation in Easy ReachIn a fast-moving, competitive environment for OTT brands, where the ability to innovate and differentiate on subscriber acquisition activity is more important than ever, innovation is also within easier reach.Brands embracing digital transformation by migrating to unified, flexible and agile subscriber management platforms will have the opportunity to react fastest to customer needs and shifting behaviours – adding diversity and removing friction from the customer proposition, quickly, at low cost and without adding unmanageable complexity to back end systems.

OT

T S

UB

SC

RIB

ER

AC

QU

ISIT

ION

ST

RA

TE

GIE

S F

OR

A N

EW

RE

AL

ITY

WW

W.M

PP

GL

OB

AL

.CO

M | 3

9

Powering Media Through Subscription & Billing

Our eSuite Platform is the world’s smartest subscriber management & billing platform. It provides the flexibility and agility required to deploy one or more business models, and innovate in every aspect of the subscriber lifecycle – and is proven to help OTT brands acquire, monetise and optimise subscriptions.eSuite’s end-to-end solution maximises subscriber acquisition, optimises recurring revenue, and reduces churn by centralising the entire subscriber lifecycle under one roof.

It integrates content metering, offers & incentives, identity management & CRM, payments & billing, entitlements & fulfilments, product catalogues, payment optimisation, churn management, and reporting

– while simple, GUI-based configuration requiring minimal-to-no technical resource enables businesses to get to market quickly, and easily.

MPP Global has a strong track record of maximising customer acquisition using the tools and techniques discussed in this playbook – for OTT clients such as Sky, Now TV, NBC Universal, TDC Nuuday, MGM, SF Anytime and UKTV.

eSuite: Key Benefits for OTTs A media-centric solution, built by and for the media

industry with bespoke functionality.

Enterprise-class SaaS with global reach, scalability, flexibility and security.

A comprehensive platform with end-to-end functionality to reduce the reliance on point solutions.

The flexibility to test and refine business models and optimise user experience to best fit your audience and brand.

An open platform for ease of integration with data, analytics and systems infrastructure.

Access to all financial & customer.

OT

T S

UB

SC

RIB

ER

AC

QU

ISIT

ION

ST

RA

TE

GIE

S F

OR

A N

EW

RE

AL

ITY

WW

W.M

PP

GL

OB

AL

.CO

M | 4

0

Get Started: Experiment, Innovate, OptimiseTo find out more, or discover how the eSuite platform could help power your OTT brand’s subscriber acquisition to new heights visit

www.mppglobal.com

For a demo or to discuss the challenges and opportunities facing your organisation contact us on

hello@mppglobal.com