Industry invaders can be useful in disruptive times
Disney, which Ekalore previously covered as an Alien Invader, came to the streaming content delivery space to disrupt traditional suppliers in cable, satellite, and Internet delivery.
Marketing managers at Disney, and competitors, have opportunities in the misfortunes of retailers.
Opportunities include:
1) Lower costs of customer acquisition by packaging or bundling ‘deals’ for content with manufacturers that can showcase TVs' multiple manufacturers
2) Bundling deals (likely with some promotional fee or bundle splitting) with retailers to act as sales agents for content owners
3) Attacking competitors’ consumer bases and margins by substituting your product for theirs when consumer uptake is limited to the number of content services consumers are willing to continually pay for
4) Moving consumers from one-time purchase content (like DVDs or BluRay) to pay-per-view, rental, or subscription consumption
5) Moving more consumers from content distribution (and lower margins) to direct-to-consumer relationship models (reducing the economic power of distributors like cable/satellite/theaters)
6) Decreasing the costs per subscriber of large content production or distribution costs (like blockbuster movies, deals for event/sports, or narrowcast markets)
7) Accept some consumer churn in return for revenue/spend capture
Each of these opportunities can be exploited with one or more of Red Square (a fictional retailer) and its competitors.
A. A manufacturer faced with lower pricing power against multiple retailers can select to pay a fee reducing the cost-of-customer-acquisition for a content provider and then include the content with all of its product merchandise units. An example is Giant Japanese Electronics including Event Viewing tickets for a limited number of streaming concert events.
B. A content provider can put an up-front “lower price” mandatory two-year bundle in with a retailer to capture customer dollars for a two-year period avoiding customer churn.
C. Setting up a ‘free bundle’ targeted with specific merchandise price points that knock-out competitive subscriptions in a purchase package.
D. Picking a content supply to replace demographic buyers interests (such as access to entire catalogs of related content, higher tier content access with a lower tier subscription, or wide subscriptions instead of narrow (Sunday Ticket, MLB, WWE))
E. “Cut the Cord” specials to lower consumer monthly spend with cable/satellite
F. Supply multi-cultural or event content only previously available on satellite channels (native language or cultural content, narrowcast interests like opera, esports)
G. “Pick me” specials targeted to groups (parents with small children, related content series) that can be binged for a certain period and thus lowering spend with competitors while adding some customers at net volume
The economic pressures on manufacturers and retailers are opportunities for content providers – especially Alien Invaders.
To read more Alien Invader stories go to www.ekalore.com/alien-invaders
To read more pieced in the Ripple Effect series go to www.ekalore.com/the-ripple-effect
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