driving revenue through effective pricing, bundling and promotion strategies
TRANSCRIPT
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This document is offered compliments of BSP Media Group. www.bspmediagroup.com
All rights reserved.
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ABOUT US
#1 GLOBAL AFRO-URBAN MEDIA BRAND
5M FANS ON SOCIAL NETWORKS
20 TV CHANNELS
ACTIVE SUBSCRIBERS IN 160 COUNTRIES
POTENTIAL AUDIENCE OF 400M FANS
#1 PAN AFRICAN YOUTH MEDIA
60M PAY TV SUBSCRIBERS
15 AWARDS FOR BEST OR COOLEST TV
20 TERRESTRIAL & DIGITAL RADIOS
>30 DIGITAL PLATFORMS
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AND ….
1.4 MILLION SUBSCRIBERS IN SOUTH AFRICA IN 14 MONTHS
GLOBAL OTT LAUNCH IN MARCH 2017
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FILM “WE ARE TRACE”
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FILM “CORPORATE”
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DRIVING REVENUE THROUGH EFFECTIVE PRICING, BUNDLING AND PROMOTION STRATEGIES
MY PRESENTATION TODAY IS ABOUT…
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HOW TO MAKE AN OTT PLATFORM THAT GENERATES REVENUES IN AFRICA?
THIS IS OKAY BUT LET’S START FIRST WITH THE BIG QUESTION
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THERE IS NO MAGIC FORMULA
THIS IS A NEW MARKET
HOW TO MAKE AN OTT PLATFORM THAT GENERATES REVENUES IN AFRICA?
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LET ME DRIVE YOU THROUGH OUR AFRICAN JOURNEY TO LAUNCH TRACE OTT/SVOD SERVICE
THERE IS PLENTY OF RESEARCH, STUDIES, PANELS ABOUT OTT IN AFRICA AND I WILL TRY NOT TO REPEAT WHAT YOU READ TEN TIMES, SO…
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• ADVERTISING CANNOT SUPPORT AN OTT MODEL IN AFRICA
• THERE IS NO MASS MARKET FOR SVOD IN AFRICA BECAUSE OF ELECTRICITY ISSUE, LACK OF CHEAP BROADBAND INTERNET AND LIMITED SMARTPHONE PENETRATION
• NO ONE CAN BEAT NETFLIX • MOBILE OPERATORS ARE GATE KEEPERS AND DO NOT
UNDERSTAND THE CONTENT BUSINESS • PEOPLE DO NOT UNDERSTAND WHAT SVOD IS • AFRICA IS NOT READY ETC…
COMMON ASSUMPTIONS WHEN WE STARTED THE PROJECT IN 2015
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ALL THESE ASSUMPTIONS WERE MORE OR LESS TRUE!
AND IN FACT…
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SO WE UNDERSTOOD WE STILL HAD A VERY LONG WALK TO GO
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AND WE WORKED VERY HARD
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AND WE CAME TO SOLUTIONS THAT WE WILL NOW TEST VERY HUMBLY
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• NO ADVERTISING SUPPORTED OTT PLATFORM
• WHEN POSSIBLE OFFER VERY CHEAP BROADBAND INTERNET WITH OUR CONTENT MAKE OUR OFFER AVAILABLE ON ALL SCREENS NOT JUST ON SMARTPHONES
• NO DIRECT COMPETITION WITH NETFLIX OR LIKES
• BUILD WIN-WIN PARTNERSHIP WITH THE MOBILE OPERATORS WITH A CLEAR ROLE DEFINITION
OUR SOLUTIONS ARE BASED ON VERY SIMPLE ASSUMPTIONS
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CONTENT DISTRIBUTION PROMOTION PRICING BUNDLING USER EXPERIENCE
OUR PAID TV EXPERIENCE OUR POWERFUL BRAND AND MARKETING CAPACITIES OUR UNIQUE RELATION WITH FANS, CREATORS AND ARTISTS
DIFFERENTIATION AND LEVERAGE
DIFFERENTIATE IN
LEVERAGE
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Introducing…
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We Love Afro-Urban Music & Entertainment
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The one stop TV, video and audio destination for the best afro-urban music and entertainment with: • 10 live TRACE channels including he best Hip Hop, R&B, African, Caribbean & Gospel
music channels and the one and only channel exclusively dedicated to sports celebrities;
• Originals and a selection of the best urban films, series and music documentaries from the USA, Africa, UK, France, Caribbean and Indian Ocean.
• 40+ digital radios offering the best afro-urban beats from Africa and the world (V2)
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LIVE DEMO OF TRACE PLAY
BETA APP
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INSTANT ACCESS TO 10 LIVE TV CHANNELS + VIDEOS + DIGITAL RADIOS
UNLIMITED - ON DEMAND - ON ALL CONNECTED DEVICES
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MOBILE APP
Afro-Urban Music & Entertainment on the go...
J O I N U S
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M A I N M E N U W I T H J U S T 4 B U T T O N S A T L A U N C H
Home Live TV On Demand Explore
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10 LIVE CHANNELS
CATCH-UP & ON DEMAND
BROWSE BY REGION, TOPIC, MOOD…
7 LOCALISED HOMES
Home Live TV On Demand Explore
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Video PlayerAvailable in English and French. More languages can be added.
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NEWLIVE TVSERIESMOVIESDOCUMENTARIESMUSIC
D E S K T O P
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Live TVLive feeds of 10 TRACE channels with Electronic Program GuideStart Over and Catch Up features
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Series & MoviesOriginals & Acquisitions
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The Best Music Offering of all SVOD Platforms in Africa including live events
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Paywall
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Coming Soon…
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HOW EFFECTIVE PRICING, BUNDLING AND PROMOTION STRATEGIES CAN HELP INCREASE REVENUE
SO…
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EFFECTIVE PRICING & BUNDLING
PRICING POWER IS THE ABILITY FOR A COMPANY TO
GET THE PRICE IT DESERVES FOR THE VALUE IT DELIVERS
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1. Don’t Be Afraid to Offer Expensive Prices (Price with Confidence) This strategy could also aid customer segmentation, separating good and great customers from the poor to average customers, allowing you to focus more on the quality of the sale IF YOUR PRODUCT IS PREMIUM. 2. Don’t assume all customers are price sensitive Price sensitivity depends on the perceived value customers place on your products and brand. To keep price sensitivity to an absolute minimum, focus efforts on attracting customers classed as value seekers - they just see pricing as part of their purchasing decision as opposed to bargain hunters just driven by price).
EFFECTIVE PRICING & BUNDLING
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3. Psychological Pricing
Psychological pricing leverages human emotion and subconscious behaviour to influence consumer purchasing decisions. The ‘charm pricing’ effect where prices end with the number ‘9’ which makes the price appear cheaper and more attractive proposition for the consumer to consider. 4. Bundle Pricing
Bundle pricing is another popular strategy to increase sales volumes while teasing customers to purchase higher priced individual items. With bundle pricing, multiple items are offered for sale to the consumer at a single price.
EFFECTIVE PRICING & BUNDLING
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36
12000 35001000 135
3000 850450 45
150 40 100 10
Côte d'Ivoire [52] Kenya [46] Nigéria [105] South Africa [80]
Pour un jourPour une semainePour un mois
Francs CFA Shillings Nairas Rands
How much maximum are you ready to pay for TRACE Play without data? (to be deducted from your mobile fees)
TRACE PLAY RESEARCH
For one dayFor one week
For one month
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37
28000 5000 1500 200
7000 1425 500 50
200 55 100 10
Côte d'Ivoire [52] Kenya [46] Nigéria [105] South Africa [80]
Pour un jourPour une semainePour un mois
How much maximum are you ready to pay for TRACE PLAY WITH DATA?
TRACE PLAY RESEARCH
Francs CFA Shillings Nairas Rands
For one dayFor one week
For one month
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Based on this research, data cost should represent more or less: • Up to 25% of content cost for daily users • Up to 57% of content cost for weekly users • 32% to 56% of content cost for monthly users
So it is fair to say that the average perceived value of unlimited data is in the range of 30% to 40% of the content value.
EFFECTIVE PRICING & BUNDLING
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EFFECTIVE PROMOTION
3 outcomes and goals must be achieved: 1. Your promotional message reaches your intended and targeted audience. 2. Your message is understood by your audience.
3.Your message stimulates the recipients and they take action.
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EFFECTIVE PRICING & BUNDLING
At Trace we have defined 3 key words for our promotional campaign:
ENTERTAIN, ENGAGE & EMPOWER our customers.
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TRACE MOBILE | TRACE MOBILE’S PROMOTIONAL CAMPAIGNS
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TRACE MOBILE | TRACE MOBILE’S PROMOTIONAL CAMPAIGNS
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TRACE MOBILE | TRACE MOBILE’S PROMOTIONAL CAMPAIGNS
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AND AS A CONCLUSION
Key words for our SVOD team just a few days before launch… - Content differentiation - Glocal (Global + Local) - Simplicity of user experience - Metadata are key - Leverage of your existing assets - African based CDN - Service integration in MNO and PayTV ecosystems - Innovative OTT distribution models - Billing adapted to each market - Test and learn
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THANK YOU