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How Premium and Freemium OTT Content Strategies Differ

When it comes to leveraging and building an audience for premium OTT content, how do strategies differ for premium ad-supported content and subscription-based content? Evan Shapiro, CEO, ESHAP, and Jennifer Vaux, VP, Content Acquisition & Programming, Roku Media, discuss how and why these strategic approaches differ in this clip from Streaming Media Connect 2023.

Shapiro says to Vaux, “To a certain extent, you have your own bundle on the Roku channel itself. It's a lot of different content from a lot of different sources, and you do a lot through acquisitions and revenue shares. But then you're also making your own original content and doing some exclusive licensing. What's the overall strategy that's different from a premium content standpoint for free than it might be from a paid ecosystem? Is there a major difference [in the] strategy that you take versus what a Netflix or a Hulu who has a paid version with ads might do?”

Vaux emphasizes Roku’s advantageous position in CTV because of its highly direct and optimized relationship with viewers. “We can be laser precise with what we buy based on what we see pop on the platform,” she says. “We have a machine learning algorithm that drives people a personalized view of the Roku channel, but we also have it in AVOD and FAST. And we program the Roku Originals in both places. So we try to meet the consumer where they want to be, depending on the viewing experience they want to have or the type of content they want to have, and we use the data to source the content on AVOD economics.”

Shapiro says, “AVOD is a relatively newish component to what you guys have been doing from the beginning. It's expanding…do you see that as a kind of co-equal with the linear experience on FAST? Do you see AVOD and FAST working in tandem together across the two experiences?”

“We definitely do,” Vaux says. “You can watch Martha Stewart in the library, but then go and watch a Roku original, which is Martha Cooks or Martha Gardens, and then go and lean back and watch more Martha in the Martha FAST Channel, just as an example. And we do the same thing with the Great American Baking Show. So we're trying to leverage all those touchpoints, how a consumer wants to interact with the content and the brand that they've decided to hang out with in that day.”

Shapiro says, “And then to a certain extent, being able to program for both those arenas in kind of a playlist version in the VOD. And then, on the linear ‘lean back’ fashion on the Roku Channel, it lengthens the stay. You don't necessarily have the churn in the same way that the paid services do, but you have a churn of like, ‘I'm going somewhere else.’ So you give them the power to run their own experience, and it keeps them around for a longer period of time.”

Vaux agrees and adds, “And just to understand the user pathing in general, what do they watch next? And always trying to understand that construct.”

Learn more about a wide range of streaming industry topics at the next Streaming Media Connect in November 2023.

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