As early entrants into digital entertainment, video game publishers have accumulated nearly 40 years of lessons learned, avoidable mistakes made, and relevant experiences they can share with other digital media and entertainment developers. This article will touch on effective monetization strategies originally developed for video games, and ideas that other media and entertainment players can adapt to their unique situations.
All entertainment producers should be aware of the critical importance of leveraging modern technologies and digital commerce platforms that support the testing of new monetization strategies, not through time-consuming and expensive IT initiatives, but with business tools that empower digital marketers to make informed decisions, and keep offerings real-time and tailored to ever-changing customer demands.
Trials and freemiums
Free trials, freemiums, and subsidized content have subtle yet important differences, and each can be fine-tuned by entertainment producers to optimize audience acquisition. Game publishers encourage buyers with a seamless transition between free play and pay-to-play. In the course of play, an added feature or a game-enhancing tool can be easily purchased with a single click and offered in a contextual way, such as when a multiplayer battle is about to begin.
Free trials usually have a limited period of use, typically seven days or thirty days, after which a payment must be made to continue. The freemium strategy relies on in-app purchases and other paid premium options. Free versions of multiplayer games are distributed as a starting point in a game and, at some point, players naturally and organically reach a barrier that leads them to spend money. Monetization has been built into the product starting from its design.
With a freemium, limited use is free, often subsidized by ads, with an enhanced version of the content available for a charge. The advantage of freemiums over free trials is that freemiums provide a seamless conversion from free to paid versions, while free trials are a little more labor intensive to convert, and may require the customer to make additional software, game, or media downloads.
For television and films, techniques adapted from gaming can be easily added to the commerce strategy. Perhaps the pilot or first few episodes of a TV series are free, to engage viewers and promote viral social sharing. At an appropriate point, when audience interest is piqued, a dynamic upsell offer is made – additional episodes or chances to preview a new release before it is available to the general public. This concept not only helps increase viewer numbers, but also initiates a direct relationship between content producers and consumers, becoming a revenue stream for repeat purchases.
Other video premiums might include digital assets layered on top of a broadcast show, extra celebrity content, or directors’ cuts and additional scenes. With IP-based video and IPTV, there could be an upsell offer from a single screen format to a multi-screen promotion that allows users to view a program on a tablet or smart phone. When popular theme music and soundtracks are a part of the mix, added revenues are possible via online music downloads through platforms like iTunes.
Real-time and targeted promotions
Digital technology enables producers to offer real-time and targeted promotions, as game companies have been doing for years. One example of this is Machine Zone’s “Game of War,” a multiplayer strategy and fighting game. At specific points during play, there are tailored purchase opportunities. The time required for a player to build a civilization and assemble an army can be shortened by buying virtual gold or game performance “boosts.” Targeted offers are made to specific user profiles, or when a specific situation exists during the game. Two or three different packages may be offered at any time, with conversions producing welcomed profits for game developers.
For motion picture and television producers, similar opportunities include promotions targeted to specific profiles, so that frequent movie watchers are offered a premium movie package, or sports enthusiasts receive special offers for bundled sports packages. With IP-based video and IPTV, when a user ‘likes’ an actor on a social platform, this data can be leveraged in real time to generate a personalized channel bundle with all movies from that actor, or to serve dynamic inserts of contextual video advertisements.
Broadcasters have been looking for new revenue opportunities and alternatives to traditional ads. One new option made possible by modern commerce platforms is for television production companies to create metadata in parallel with content development to identify products, clothing, beverages, vehicles, and other items depicted within the program. These items could be purchased by viewers as they watch an episode. As an example, a dress or jacket worn by an actor could be offered for sale as a one-click in-app purchase linked to Amazon, or through a commerce account with a national apparel store.
Cross promotions could produce immediate conversions in travel or food shows. When a viewer sees a desirable hotel, restaurant, theme park, or airline in a show, they could click to make a reservation or purchase a ticket in real time. Commodities such as beverages, foods, tech gadgets, and books could also be ordered instantly for home delivery, or for pickup from a nearby store.
Anything viewed in a streamed movie could be purchased instantly, provided the product information is encoded in the metadata, and the viewer is linked electronically into a purchase account. hybris has developed a demo used in its software labs that shows a tablet displaying contextual product information and commerce functionality for specific products appearing on TV, sensed through an encoded audio signal.
By leveraging the mature world of multichannel and omnicommerce used by nearly every large retailer and major manufacturer today, digital entertainment producers can create new revenue streams that generate income limited only by the geography of their content distribution and the pocketbooks of their audience.
