October 25, 2013 © ArcInsight Partners LLC Client Slide 1

ArcInsightP A R T N E R S

VX-360

A Design MethodReliance Entertainment Digital | ArcInsight Partners

(S A N F R A N C I S C O / L O S A N G E L E S)

Oct 2013

Tech | Media | Entertainment | | CONVERGENCE |

Viewer Experience Design To Drive Real Competitive Advantage For VOD Success

October 25, 2013 © ArcInsight Partners LLC Client Slide 2

ArcInsightP A R T N E R S

VOD Misconceptions & A Case For Experience Design

Video-On-Demand has reached a reasonable maturity level and user penetration in developed economies.

• Netflix crossed 40M subs, surpassing HBO. No longer viewed as “the Albanian army”.

• Incumbent PayTV networks scrambling to offer competing VoD services to hold back subscriber churn to OTT video. Want to include Netflix as a content “channel” (Surprise !)

They keys to long-term engagement lie in - Deconstructing the viewer context- Identifying key viewer journeys that differentiate, and - Re-mapping the viewer relationship using an expectations-reward framework.

Several misconceptions abound in the SVOD service model.

THE MYTHS

1. Fresh content alone will retain subscribers

2. New releases guarantee a viable premium monetization strategy

3. Ultra low price or freemium models accelerate viewership

THE REALITY

1. Netflix's stale content-library did not drive it out of business

2. Experiments with releasing new post-theatrical and “in-theater” films at super-premium prices did not entirely succeed. Mostly abandoned.

3. Ultra low price / freemium models drive “Trials", not necessarily “Conversions“.

Designing multiple “Moments of Truth”. An evolution in thinking over traditional viewer touch-points.

Typically multi-touch, multi-channel and cross-functional

Events that mark a Defining Experience for each life-cycle phase for the viewer

Anchored in the Viewers own perspective. “How Does My Viewer Think About It ?”

The Viewer Journey

The Truth About Customer Experience / Alex Rawson, Ewan Duncan, Conor Jones: Harvard Business Review