What is Value Management?
End-to-end management of the difference between benefits obtained and the cost incurred by the customer. Here the cost can be a one-time cost, maintenance cost, deployment cost, etc.
The entire Value journey can be broken down into five(5) different steps -
Understanding Value
Creating Value
Capturing Value
Communicating Value
Delivering Value
Understanding Value
Industry
The video OTT market was valued at INR 249.09 Bn in FY 2022 and is expected to reach INR 581.21 Bn by FY 2027, expanding at a CAGR of ~16.58% during the FY 2023 — FY 2027 period.
Why do people prefer content over price
Availability of quality, diverse and exclusive content
Meeting the rising demand for vernacular and regional content
Personalized subscription model
Anywhere and anytime access to OTT content
Customers
The leading Indian OTT players are Netflix, Amazon Prime Video, and Disney+Hotstar. 80% of consumers now have at least one content streaming application on their smartphones
Types of OTT Customers in India
Conventional TV viewers who got into OTT content (web series) primarily through various genres like crime, suspense, thrillers, and action ~ 13.3%
Younger Citizens — Younger, heavy SVOD viewers in metro cities who always prefer International content over Indian content ~ 16.1%
Biased audience group who prefers watching adult/mature content ~11.5%
Mature audience who are yet to consume OTT heavily and is inhibited by a price point of subscription ~11.4%
Anywhere Anytime Addicts, who watch OTT content at the minimum available opportunity ~8.2%
Older audiences who are into OTT to view catch-up Television ~11.2%
Primarily older audience who watch mainly movies mostly on weekends ~8.9%
Audiences whose consumption is mostly long or short-format comedy content ~8.6%
Younger weekend viewers who show disposition towards youthful content ~7.9%
Challenges
More fiber capacity and power are required
Speed and quality of content
Application of inappropriate revenue model
Retention of audience
Content piracy and Video quality
Creating Value
Amazon Prime Video (APV) is instrumental in creating value for its audience with the help of the content they offer. Let's analyze a few ways in how APV creates value for its customers in India
“Amazon Originals” — APV India release original movies and series under the banner “Amazon Originals” and purchase rights for many of them
Quality of Content — APV is very particular about the quality of content. Amazon Originals have gained more than 45 Emmy nominations and that too in different categories for movies and series
Quantity of Content — Amazon Prime Video delivers more than 75 million videos worldwide
Prioritizing Mobile-only users — Amazon also planned to take the initiative of rolling out 5G in the region by offering yearly subscriptions at a lower price exclusively for mobile-only users
Local content first — They always try to retain growth by prioritizing local content across different Indian languages
3rd Party English language content — In terms of acquiring 3P English language content, APV stands only behind Disney+Hotstar with the second most number of premieres
Capturing Value
Amazon Prime Video in India uses different types of monetization models in its platform. It offers content that can be viewed by purchasing different categories of subscriptions, special screenings that are being offered at a rental cost, and finally, it runs several ads to generate additional revenue
A. Subscriber Video on Demand (SVoD)
This is a subscription-based business model. Customers incur a cost to access the platform and in return, they can stream movies, videos, and other content. Amazon also offers an independent subscription to Prime Video, which can be accessed by non-Prime members for a certain monthly fee.
B. Rental Service (TVoD)
Amazon Prime India also offers the sale or rental of individual movies or TV shows to generate revenue even certain programs or sports tournaments require one to pay certain additional fees to get access
C. Ad-based VoD on Prime Video
Amazon Prime Video earns a lot of revenue by running ads while playing its content thus it helps APV to provide content to its customers at a lesser price. There are three types of videos that are being streamed on the Amazon Prime India platform
Live Streaming
Content produced by Prime Studio or Self-made content
Purchased or acquired content by paying the license fee
Communicating Value
Content Marketing — According to an article by The Telegraph more than 22 million paid users are the result due to the content APV offers. Amazon is well aware of keeping its audiences engaged with the content. As mentioned earlier Amazon Prime Video is very particular about the quality of its content also they do offer a huge no. of videos to stand out as far as quantity and varieties of offerings are concerned
Commercials played on Television — APV plays television commercials to attract users to their streaming platform. They also advertise their latest release. For example: Amazon Prime — Membership Ek, Khushiyan Anek
Social Media Marketing — Amazon Prime India maintains several different social media handles across different geographies to create buzz among audiences of different age groups. They also run paid promotions on Facebook and Instagram to promote Amazon Prime Video
Meme and Moment Marketing — Amazon Prime India is instrumental in meme and moment marketing across social media in regard to its various series and movies. They are very aware of crucial and popular moments in their content and commercialize them
Delivering Value
As far as delivering value or sales is concerned Amazon Prime India is adopting different curated and well-thought strategies for different segments of OTT.
As per a report, there are around 69% of total OTT population in India who don’t prefer to watch paid content. This compartment is what Amazon Prime India is looking forward to encashing their sales. They have also come up with exclusive plans for the Indian audience
As far as revenue generation is concerned there are two such sources for any streaming services
Subscription — Video on Demand
Advertisement — Video on Demand (Free User)
The majority ( >60%) of SVOD packages are being sold in collaboration with telecom operators as a part of internet recharge packages ( both prepaid and postpaid)
APV also collaborated with different regional OTT players and integrated their content into APV’s platform. For example — NammaFlix ( Kannada content), Hoichoi (Bengali Content), ManoramaMAX (Malayalam Content), etc.
Amazon provides cross-platform privileges to the users who purchase APV memberships in terms of e-Commerce delivery benefits (Amazon.in), E-Book reading (Kindle), Audio Story access (Audible), etc.
References
http://www.researchandmarkets.com/reports/5701300/ott-over-the-top-market-in-india-2022-2027
https://www.india-briefing.com/news/india-ott-video-segment-growth-trends-investments-27681.html/
http://www.adgully.com/4-reasons-why-ott-customers-are-choosing-content-over-price-112598.html
https://images.assettype.com/afaqs/2020-05/e249842c-880c-4048-acdf-34a0eb514b05/OTT_AudienceSegments_OrmaxMedia__1_.pdf
https://marqueex.com/amazon-prime-marketing-strategy-when-quantity-meets-quality/
https://www.muvi.com/blogs/how-does-prime-video-make-money
https://www.telegraphindia.com/my-kolkata/lifestyle/why-amazon-prime-video-is-winning-the-ott-streaming-wars-over-netflix-and-disney-hotstar-in-india/cid/1863539
https://marqueex.com/amazon-prime-marketing-strategy-when-quantity-meets-quality/
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