Although live video has been around for years, with the advent of secure, easy-to-use, OTT-enabled (over-the-top) applications, the consumer’s appetite for live video has never been stronger. According to a report from MarketsandMarkets, the OTT market is expected to grow from $28.04 billion in 2015 to $62.03 billion by 2020. Brands and content owners are capitalizing on the opportunity to engage viewers on a more intimate level and aren’t just using live video for behind-the-scenes content or distributing a live broadcast feed. They’re using it for a broad array of professional content, like engaging influencer videos for product launches, live chat sessions with fans, and professionally produced live events. Live has become a new, exciting, and effective way to monetize content. The availability of live has increased the amount of time people spend watching video on digital devices, making it more comparable to the time they spend watching TV. The average live video viewing time overall increased by 62% between 2016 and 2017. Subscriptions, advertisements, and the most promising, transactional/pay-per-view models are some of the ways to monetize live video, and brands are discovering how effective it is. This tutorial will explain the specific ways to monetize live video, detailed challenges, and where the money is.
Choosing the Right Live Streaming Platform
Choosing the right platform for monetizing your live content is an important decision. The right platform can offer access to a large audience or can provide users who are willing to pay for your content. There is a trade-off between access to a large audience and the ability to convert that audience to paying customers. Larger platforms will offer greater access to viewers; however, they may take a cut of ad revenue or limit your ability to make money off of your content. Smaller start-up platforms may offer more incentives since they are trying to grow their content provider base. After you monetize your content, a cut of advertisement revenue or a subscription fee platform will still take a percentage of revenue you’re making from live streaming, so it is important to take this into consideration.
Strategies for Monetizing Your Content
Though getting to the stage where you have a large enough audience to entice sponsors is rare, it is certainly something that’s a valid long-term goal. It might help to think of it as trying to get a good job out of college; sure flipping burgers isn’t your dream career, but you probably did it because the pay was better than the job at the local sub shop. Same basic concept here; do a few product reviews and maybe some gaming tutorials for a product genre, then move on to the genre’s big companies and offer to do a product review. Be sure not to pander to the company, doing so may lead your viewers to distrust your opinion on the product. Simply make an honest review and if the company sees a good response, they may use you for feedback on their product or for an event in the future. This could also lead to testing a game’s beta and offering feedback. Finding an actual endorsement deal may be difficult, but is certainly feasible to anyone with a high viewer count and a bit of charisma. This is something that may best be mediated by an agency, and should be approached with caution, as doing a bad job can be worse than not doing it at all. An alternate method is to simply place ads on your broadcast. This is an excellent way for the average broadcaster to earn something for their efforts. Sadly, often the ads that bring in more revenue are those annoying ones that pop up and disrupt the viewing experience. It’s up to you whether you would subject your viewers to such ads, and please do keep their viewing experience in consideration. The more viewers and the more frequent your broadcasts, the more revenue you will get from this.
Advertising and Sponsorship Opportunities
Vincent Pecoraro, founder of Black Sun Entertainment, says that the key to securing advertising and sponsorship revenue is the ability to promise large audience numbers and an attractive viewer demographics. One advantage of streaming advertisements is the ability to give immediate feedback on how many times an ad was clicked, and viewer commentary can be a good indication of how well an ad campaign is being received by the audience. Stepfani McGarry stresses the importance of maintaining advertisement relevance to broadcast content and not chasing profitable but undesirable ad campaigns.
Even though live streaming services provide an interactive platform for content delivery, a presentation of advertisements or personal endorsements can be just as profitable as they are on traditional television. Some streaming providers, such as Stickam, have built-in advertising systems which content providers can join. For those who don’t have access to a system such as this, they can choose to take short breaks from their live broadcast and run pre-recorded ads. The most common solution, however, is to look for sponsorship from companies who are willing to pay the broadcaster to promote them to their viewers. This can be a simple mention in the broadcaster’s speech, shown through a graphic/logo during the broadcast, or a personal endorsement from the broadcaster. Either of these systems can be profitable if the broadcaster is partnered with the right companies, the sponsorship does not strongly conflict with the broadcaster’s image, and the advertising presentation is not overly intrusive to the viewer.
Paid Subscriptions and Pay-Per-View
Pay-per-view systems offer payment on a per unit basis, where a “unit” is often defined as the playback of a particular piece of content. For live streaming content, pay-per-view payments are typically made in advance to secure access to an upcoming stream. The restriction of paid content may require some form of authentication to differentiate paying viewers from non-paying viewers. One simple method involves separate streams for each type of viewer, but this may inconvenience the paying viewers who would need to avoid clicking links to the non-paid content. An alternative is to customize the content viewing page based on the user login, but this requires more sophisticated web development. Pay-per-view payment methods are suitable for any video-on-demand style content, where the viewer can choose precisely when to watch the content. It is particularly suitable for exhibitions and sports events, where the content is only available for a limited time.
Another way to monetize content viewed via live streaming services is by offering alternative payment options. This approach targets viewers who actively avoid advertising or who are willing to make payments to save time. The most common alternative payment option is the use of a subscription system, in which the viewer pays a regular sum (usually monthly) for unlimited access to content. This payment method may not be suitable for all live streaming content, as it requires a considerable commitment from the viewer. However, it is very suitable for certain kinds of content and viewers. For example, a lecture series or a language course would be ideal for a subscription system, as the content is presented in multiple sessions. The viewer who is interested in the content would much prefer paying a lump sum for unlimited access, rather than paying a smaller sum for each session. On the content provider side, subscription systems provide a relatively stable and predictable income compared to other payment methods.
Merchandising and Product Placement
Merchandising and product placement are another alternative for content providers seeking to maximize earnings. Content providers can form an online store, create custom merchandise, or use a drop shipping service to market merchandise from a third-party website. An online shop is simple to make and maintain. There is a wealth of eCommerce solutions accessible that provide hosting, design templates, customer service, along with other tools required to make a professional-looking website. They also have low monthly costs and don’t require any kind of long-term commitment. Custom merchandise is usually created using a third-party service like Café Press. Essentially, the content provider designs graphics for the merchandise, which might be printed on almost anything like t-shirts, hats, and mugs, and the service creates the merchandise and ships it to the consumer taking a modest cut in the cost. This involves no monetary commitment from the content provider. Using a drop shipping service, like the one provided by Modern approach to promote the gaming website Gaikai using in-game advertising. With this approach, the merchandise will likely be tied directly into the content and will seem a lot more natural to the consumer. Overall, the key to success with merchandising and product placement would be to facilitate purchases in a way that is non-invasive and offers actual worth to the consumer.
Maximizing Revenue and Engagement
The option to insert mid-roll advertisements into your stream has never been easier for Wowza customers. Many of our customers want to monetize live events by playing ads at specific times during a live stream broadcasting an event or conference. To do this, customers can use Wowza Transcoder to create SMIL files that reference specific playback points during the stream to switch to an advertisement file. An example of how a customer may want to do this is to use a live stream of a long conference with a very large audience. At specific times during the conference, the SMIL file would tell the live stream to play an ad file instead of the live content. Wowza Media Server can restream an incoming encoder feed to Adobe Flash Media Server and use Adobe’s ad insertion capabilities to allow customers to track the number of users that see an ad and verify campaign delivery.
Leverage the technology: The viewers of the future are becoming more accustomed to paying for content, but are more selective of the content they choose to pay for. Over the past couple of years, we have seen increasing interest from content producers to monetize their content. Whether you are creating content as an individual or a company with a brand, an important step to take is to create a business strategy that includes generating revenue with your content. Premium content is a revenue generator for HLS live streams, and the most popular method to secure, control, and monetize premium content an event is using the HTTP Live Streaming protocol.
