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SURE! Blog

How to Achieve Competitive Differentiation in a Crowded OTT Market?

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Dec, 2015


OTT market is expanding very quickly now and the competition in this market is getting harder every day. Companies who want to achieve a competitive differentiation in this crowded market need to follow some key principles in order to let them build and scale their OTT business.

The key factors are as follows:

Flexible Pricing and Packaging

With OTT subscriptions, pricing is a very valuable strategic tool, as pricing is tied directly to the growth of revenue via acquiring new customers, increasing the existing customers value, and reducing customers loss. The pricing and packaging can be a bit complex, as it can be by the device type, capacity of users, concurrent streams, or by family/group plans. Pricing may differ based on time periods as it can be daily, monthly, quarterly, or annually.

There are also promotional models such as free trials, freemium, or partner offers in order for hooking in customers at almost no cost. Pricing and packaging will require flexible operational systems which can allow fast response to the customers changing preferences, and support the regular iterations.

Customers Acquisition across Different Channels

The sign up process should be done across different channels such as mobiles, web, smart TVs, tablets, or via assisted sales because the traditional systems weren’t designed for supporting the IP-centric OTT subscription elements. The complexity in the process of acquiring a new customer may result in having slow marketing time. The subscription process in OTT business needs to be established simple, fast, automated, and streamlined across multiple channels.

Accurate Invoicing and Billing

Without using the right billing systems, the process may take weeks in order for generating bills, can be a very big challenge to scale, and the errors may cause frustrated clients. These complexities require not only accuracy insurance, but also an easy to understand presentation to subscribers. The billing systems should be programmable engines which can take all inputs, calculate accurately, and then deliver clear bills which are synchronized with the company’s image.

Customer Engagement

As customers are the core of any business, customer relationship is the core of OTT business model, and developing customer relationships becomes an emergency element especially in the company’s entire framework. OTT business should provide its customers with intuitive tools in order for managing their accounts over the lifecycle of their entire subscription, and the business have to monitor closely the customers usage and their adoption in order for mitigating the risk of losing customers, or for identifying the opportunities of making upsells.

Revenue & Accounts Management

OTT subscription has a huge number of changes and order transactions over its lifecycle, which may create ripple effects on billings, bookings, and revenue. Such challenge may not appear when the company just makes an initial launch for subscription offering, which may result in getting the process of subscription finance ends up being manually handled in Excel sheets. OTT business should identify better and more integrated ways in order for streamlining the accounting process, and maintaining the compliances.

Analytics & Reports

OTT business should often make swift decisions which can leverage key metrics from the booking phase till the revenue recognition phase. The business, to be successful, should focus on some metrics such as the growth efficiency index, the recurring profit margin, the retention rate, and ARR (Annual Recurring Revenue).

Iterating and Quickly Deploying New Pricing

OTT subscription has unlimited pricing options and companies usually begin with simple and recurring pricing models when they just launch their subscription offering. As the customer needs will change over time, the competitors may enter with completely differentiated offerings. The business should quickly iterate on the pricing models in order for maximizing the customer acquisition, and for increasing the market share as well.

Scaling with Secure and Reliable Infrastructures

OTT business needs enterprise-grade systems with integrated services which are on secure and scalable infrastructures, as well as with reliable 7/24/365 operations in order for quickly scaling and having easy integrations with payment gateways, commerce systems, as well as with other technology systems.

By : Satish Garikipati

Satish Garikipati is a consultant with SURE! (a Magnaquest product). SURE! is an internationally acclaimed player in comprehensive end-to-end Subscription Business Solutions for PayTV, Broadband and Cloud Computing businesses – through deployment of Metered Billing, CRM, Service Fulfillment, Value-Added Services, and Managed Services.

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