The 5 Biggest Mistakes Companies Make When Launching a New OTT Service
Congratulations on deciding to take the first, most important, step in launching an over-the-top (OTT) service, research! While OTT is a relatively new technology, it’s been around long enough to learn from past companies’ mistakes. These are the five biggest mistakes we’ve seen companies make over the last 10 years that ultimately cost them a lot of money and forced them to start over.
Mistake #5: Trying To Do Too Much Right Out Of The Gate
If you are just getting started with OTT, it’s best to start off small and gradually add-on to your service as you learn more about your audience.
Too often we have companies coming to us wanting to launch a subscription service on 8+ platforms with video-on-demand, pay-per-view options, 24/7 live streams, and a handful of advanced features. Not only would this be very costly, but in six months, you may also learn that it’s the wrong business model. This is why we recommend starting off simple. Choose 1–3 platforms and one distribution method (i.e. video-on-demand). As you start making money, you can gradually start to scale.
Mistake #4: Not Enough High-Quality Content
If you don’t have a sufficient library of high-quality content, you may want to reconsider your launch window. It doesn’t matter how great your apps are, if you don’t have enough content or quality content that people want to watch, you won’t have loyal viewers. Without loyal viewers, it will be difficult to make money. We recommend at least 100 video assets before going live. This is why content should always be your #1 focus.
Mistake #3: No Marketing Plan
As the OTT industry begins to grow and platforms such as Roku, Fire TV, Smart TVs, etc. add new services every day, it’s easy for your service to get lost in the shuffle. The iconic Field of Dreams quote, “If you build it, they will come.” is, unfortunately, a marketing myth. Netflix sure didn’t build an audience by waiting for people to sign-up. In fact, they’ve spent over 2 billion dollars each year on marketing for the past three years (Statista, 2020). The harsh truth is, without a marketing plan, you’re setting up to fail.
Mistake #2: Launching a Purely SVOD Service without an Established Audience
As a young business, it’s important to build trust. If customers are paying for your product, they want to know they will receive value. This is why you may see bakeries handing out free cookies, consultants offering free instructional PDFs, or software companies providing free versions or trials of their SaaS products. This is no different when it comes to OTT. If you don’t already have an established audience, we recommend starting with an ad-supported business model (AVOD) or, at the very least, offering a free-trial.
Mistake #1: Choosing a Limiting Solution
Imagine choosing and launching your channel with an all-in-one solution that is perfect; it fits your budget and has all of the features and customizations you need right now. After a year or two, you are ready to upgrade– you want to enhance the user interface, add a subscription option for viewers, and switch out the mediocre online video player (OVP) to one that’s more reliable. Unfortunately, you didn’t ask your ‘all-in-one solution’ provider about scaling and find out the hard way that you are stuck with one of two options:
- Keep your current solution as-is, even though it is holding you back from reaching your full monetization potential.
- Start over and spend more time and money building a new solution that will allow for flexibility and growth.
I can’t stress enough how important it is to do diligent research and find a provider that will scale with your company. Choosing the cheapest, quickest solution off-the-bat may work for a short time, but in the end, if you are looking to grow in this industry, you’ll need a dynamic product that will integrate with the latest technology.
