Introduction
Selecting the best monetization strategy to use with your VOD platform is vital to maximising revenue and creating an engaged audience. The three most popular models -Subscription Video on Demand , Transactional Video on Demand and Advertising Video on Demand --offer distinct advantages based on your content type, your target audience and revenue goals.
Understanding how each model operates will allow you to determine the best approach to use for you and your VOD platform.
- Subscription Video on Demand
SVOD provides unlimited access to the content library with a set recurring cost (monthly or quarterly, or even annually). It is a great option for platforms that offer a huge selection of exclusive or niche content.
Benefits:
- It ensures predictable, steady revenue.
- Encourages long-term customer retention.
- It is ideal for high-end entertainment, fitness, as well as educational content.
- Examples: Netflix, Disney+, and Hulu.
- Transactional Video on Demand
TVOD lets users pay per video or for events (pay-per-view or rent). This model is ideal for platforms that offer high-quality or event-based content.
Benefits:
- Maximizes profits from blockbuster movies as well as exclusive programming.
- Attracts those who are more interested in only one-time purchase.
- Example: Apple iTunes, Google Play Movies as well as UFC PPV.
- Advertising Video on Demand (AVOD)
AVOD generates income through ad spots, which provide users free content while the advertisers are compensated for their exposure.
Benefits:
- Large audience is attracted by free content.
- Earns money without direct payment from the user.
- Examples: YouTube, Pluto TV, and Tubi.
Conclusion
The most effective monetization strategy that you can use on your VOD platform will depend on the content strategy you choose to use and your audience preferences. SVOD is ideal for subscription-based premium services. TVOD works best with exclusive pay-per view content and AVOD is perfect for ads-supported free content. A majority of platforms use an approach that is hybrid, which combines different models to maximize revenues. If you choose the right method and implementing the right strategy, your VOD platform can be successful in achieving long-term success and increase audience.
