How to Create a Video Monetization Strategy in 5 Steps [2021 Update]
A solid video monetization strategy presents a tremendous opportunity for today’s broadcasters. Organizations of all sizes are using live streaming, video on demand, and OTT technologies to distribute content quickly and effectively while generating revenue at the same time.
With traditional cable and satellite networks rolling out their own video subscription plans, it can feel tough for new players to complete. However, with the right video monetization strategy and related technology, it is possible to generate impressive results, even with smaller audiences.
Independent broadcasters, SMBs, and enterprise organizations can create new income streams with the support of an online video platform. Creating great content for your audience, giving them on-demand access, and making payment processing simple is the recipe for success.
In this post, we will discuss everything you need to know about creating a video monetization strategy. We’ll cover everything choosing a type of monetization to launch your content. We’ll take a close look at different monetization methods, including ad integrations, pay-per-view, and subscriptions.
Table of Contents
- What Is a Video Monetization Strategy?
- Common Video Monetization Models
- Video Monetization Use Cases
- How to Create a Video Monetization Strategy
- Plan It Out
- Choose a Type of Monetization
- Choose a Video Monetization Platform
- Work Out the Specifics
- Launch Your Content
- Final Thoughts
What Is a Video Monetization Strategy?
Video monetization is getting paid for granting access to viewers. In other words, video monetization involves viewers paying you to watch your videos or others sponsoring content to advertise to your audience.
Even with the wealth of free content available online, audiences will still pay a premium for specialized expertise, entertainment, or information when marketed correctly. If people truly believe your content can solve their problems or somehow enhance their lives, they will not hesitate to pony up for access.
Although video monetization is possible in a limited capacity with sites like YouTube, these are mostly consumer-grade platforms that are not designed for business video hosting. A more professional approach is to use an enterprise-grade video solution that offers total control over both content distribution and monetization.
There are a few approaches that you can take to monetize your content. You can generate revenue from your viewers or access to your audience. Let’s take a look at these approaches.
Having control over your content means you set the rules regarding pricing and access (not external providers). Just like going to the local movie theater or subscribing to Disney+ or Amazon Prime, viewers pay you for the right to consume your content.
Using a professional online video platform, organizations can easily set up paywalls or manage subscription services to capture this revenue.
Alternatively, you can sell access to your entire video content library, usually, by way of recurring monthly or yearly subscriptions. Creating a video-on-demand portal allows audiences to pick and choose the titles they want and then stream them to compatible devices.
As you continue growing your audience and content, platform access revenues will follow suit.
On the opposite end of the spectrum, brands will pay you directly to access your audience through advertisements. This is especially common when you have a large viewer following or create in a specialized niche or market.
This type of audience access aligns closely with traditional forms of advertising like those used in radio or television broadcasting.
Video Monetization Use Cases
Video monetization is valuable in multiple use cases that fall under the live and on-demand streaming umbrellas.
Let’s take a look at some of the most popular use cases.
One of the most common misconceptions about live streaming is that it only applies to concerts or sporting events. While it is true these outlets are prime candidates to stream live video, they are certainly not the only ones.
Many organizations with an online presence can benefit from incorporating live streaming into their website.
Take fitness and exercise as one example. Having large in-person classes is great, but imagine the possibilities of streaming your event live and reaching hundreds if not thousands of additional participants. This creates the potential to generate additional revenue and form connections with long-term clients for roughly the same amount of effort.
CrossFit, Zumba, yoga, or spin classes are just a handful of fitness specialties that can benefit from live streaming. Even better, once these classes are over, they can be moved to your VOD library and continue to pay dividends as time goes on.
The same holds true for other verticals such as media companies and agencies, thought leaders/influencers, and even political campaigns. All of which can benefit financially from live streaming events, releasing new content, or holding events to advance their cause.
Video On Demand (VOD)
Even if you are not quite ready to stream live, taking advantage of video on demand (VOD) content is still a smart option. Utilizing VOD content allows broadcasters to record, edit, and fine-tune their message before releasing it to the public.
Education and e-learning are two of many industries that use video on demand.
Organizations can create and share their content as single classes, a series of events, or entire courses for viewers to follow along with. Using a professional-grade online video platform allows for reliable remote learning with built-in monetization tools already included.
With hosting solutions from Dacast, VOD content stays safe and secure while providing valuable analytics for measuring reach and learner engagement.
How to Create a Video Monetization Strategy
Now that you understand the value of video monetization, let’s take a look a look at the five steps you can take to build a video monetization strategy of your own.
1. Plan it Out
Every great video monetization strategy starts with a solid plan. In order to create a plan, you’ll have to have a solid understanding of what you have to offer and who you’re trying to reach. Consider the real value of your content to that audience.
Ask yourself the following questions to start organizing your thoughts:
- Is your library extensive enough to charge a subscription fee?
- Would your viewers be willing and able to pay for access to your content?
- Is your audience large enough to warrant sponsorships?
- Will ads deter users from your content?
- How will your content impact your viewers? What is the return on investment?
- How much do you need to make to break even?
Use your answers to these questions to determine what you want to charge for your content. Also, use this opportunity to set some specific goals for your content.
2. Choose a Type of Monetization
Now that you’ve had some time to consider what you’re setting out to achieve, it is time to choose a specific type of monetization.
The best OVPs are one-stop shops as they provide integrated hosting, distribution, and playback of content in a single package. Top-tier providers also include integrated paywalls to restrict user access and generate revenue from your content.
The most common formats for video monetization for live streaming include pay-per-view, subscriptions, advertisements, and funneling.
The thing to keep in mind with these monetization models is that it is not an all-or-nothing proposition. Many brands mix and match these formats depending on the amount of content they have, their audience, and the interest of third-party advertisers.
That said, let’s break them all down.
Pay-per-view, which is also called “PPV,” “transactional video on demand” and “TVOD,” requires viewers to pay for each piece of content that they watch.
TVOD is a very lucrative monetization model. Having first-run rights to exclusive content means broadcasters can charge a premium for access. However, the consistency of revenue is typically less as compared with subscription monetization models.
Although PPV has seen tremendous success with live sports streaming (such as boxing, MMA, Wrestling, etc.) it also works well for concerts, conferences, and special events, such as workshops from coveted speakers or business leaders.
However, with a little creativity, broadcasters can turn conferences, gatherings, or webinars into pay-per-view streaming events as well.
Subscription-based video on demand, or SVOD, is a commonly used monetization format where users pay a recurring fee (usually monthly or annually) to access content from your video library. Subscriptions require a bit more work upfront but offer the added benefit of recurring revenue. Providers like ESPN+, Netflix, Hulu, and HBO Now serve as good examples here. Users pay a set monthly or annual fee to access content from their VOD libraries. Users benefit from 24/7 access to a wide range of content while broadcasters win because of the recurring revenue generated.
Studies show that more than one-third of broadcasters use subscriptions as their primary content monetization option. Subscription models are attractive options as broadcasters are not as dependent on third-party advertising revenue. Serving up fewer ads also makes for a better overall audience experience.
However, it is worth noting that any type of paywall option typically reduces the number of traffic websites will see. With so much free content online, some viewers are reluctant to pay for anything. Yet, producing great content for a dedicated following helps to overcome this hurdle.
Subscriptions generally work best for larger audiences, though there are exceptions.
Ads and Sponsorships
Selling ads, which is one of the oldest forms of marketing, work with video in much the same way as radio or television. Brands pay to share their advertising with your audience, usually along with the bottom third of the user’s screen or in short clips throughout a video.
This model is one most online audiences are already accustomed to. With advertising video on demand, the majority of a broadcaster’s content is free because operations are supported by third-party ads used before, during, or after your videos.
Typically, audience size is the determining factor in how profitable ad-based video on demand (AVOD) can be. The more reach you have, the higher fees you can command from advertisers. However, even smaller audiences can still be profitable. A strong niche following with loyal viewers can fetch top dollar for advertising space.
Sponsorship is very similar to ads, except that brands pay to have direct product placement within the videos or formal credit for bankrolling production. A bit trickier to implement than ads, sponsorships can still prove lucrative given the right situation.
You can also use video to drive traffic to other websites or landing pages for revenue generation.
After viewers watch your videos, broadcasters include specific calls to action regarding what steps they should take next. Usually, this involves a separate link to click on or a follow-up video providing additional information.
Funneling results vary as it is difficult to predict what viewers will do, even with specific CTAs. As with any video marketing strategy, the key is to understand your audience in order to maximize results for your funneling efforts.
3. Choose a Video Monetization Platform
Once you decide to start monetizing content, the next step is selecting an online video provider to work with. No matter which route you choose for monetizing content, you will need to find the right online video platform to help you accomplish your specific goals.
Modern online video solutions like Dacast make it easy to implement live streams, create VOD libraries, and provide over-the-top (OTT) video distribution.
While there are dozens of options to choose from, few offer the end-to-end solution that Dacast provides. Especially with such competitive pricing and generous bandwidth options.
Here are a few features that you should look for in an online video platform to support your video monetization strategy.
Choose a platform with an integrated video paywall for a streamless monetization experience.
While other video platforms require third-party add-ons, Dacast’s secure, white-label paywall solution is integrated directly into our platform. With support for more than 135 different currencies in ten different languages, configuring group pricing and collecting payments is a breeze.
We also support both credit cards and PayPal so users have multiple payment options.
Powerful Subscription Management System
A subscription management system will help you to keep everything in line with your subscribers.
Controlled via our dashboard or video API, the Dacast platform allows broadcasters to effortlessly add subscribers to their channels. Subscriptions can be configured for weekly, monthly, quarterly, or biannual payments and easily downloaded (in CSV format) to track user and revenue analytics.
Live Event Support
Live events can help you to connect with your audience while generating revenue. Choosing an online video platform with live streaming support opens the doors to explore possibilities with this style of streaming.
First time hosting a live streaming event? Need extra assistance for a large event? Dacast has you covered with our professional services program. We can maximize return on your project by managing the event or helping to configure your own high traffic, secure video website.
Top-Tier Content Delivery
When you’re generating revenue on your content, it is important that your video player is reliable and your delivery is consistent. Choosing an online video platform that partners with top-tier CDN networks for content distribution are absolutely essential.
Dacast partners with several impressive CDNs, including Akamai. With over 216,000 media servers in 120 countries around the world, 90% of global internet users are within a single hop of an Akamai network. This massive scale offers unparalleled performance and the bandwidth to deliver consistent quality and secure streaming experiences around the clock.
Coupled with Dacast’s 24/7 service and support, you can rest assured knowing your content is safe and remains available anytime your audience needs it.
No other video hosting platform offers this much value at such a reasonable cost.
4. Finalize the Details
Once you’ve chosen an online video platform, it is time to consider the available features. Some platforms include bonus tools including free trials, promo codes, and more.
Let’s take a look at how to put some of these bonus tools into action.
VOD providers often use a limited-time offer (typically around 30 days) for audiences to try out their services and see what they think. The beauty is that once the billing cycle begins, a large portion of these free users will elect to continue with the same services.
Video hosting aside, free trials are a common pricing model that works well to attract new customers in almost any vertical. Brands that implement this strategy often report better conversions as opposed to those that do not.
“Freemium” is another pricing model that works for video monetization (but usually not as well as free trials). Viewers get free, albeit limited access to your video library for as long as they want. However, premium content remains hidden behind paywalls with paid user accounts required for access.
The freemium model works well to build a following. However, it requires constant marketing to entice free users to convert to paid accounts.
The tiered pricing method is another model used by some online providers. In this approach, services vary based on the cost of the users’ monthly plan. For example, the lowest tier may be able to stream to a single device in standard definition while higher-priced plans afford multiple screens streaming in HD quality.
Tiered pricing is a flexible monetization option that allows broadcasters to creatively mix and match their offerings any way they choose. However, this model works best for large audiences and may not be ideal for broadcasters just starting out.
Promo codes allow broadcasters to give discounts to their viewers. These can come with different terms and different discounts. This is a good way to entice interested viewers to sign up or to honor your loyal viewers.
Promo codes are also great if you use influencer marketing. This way, you can give different promo codes to different influencers and track your results.
Group pricing is exactly what it sounds like. You can offer group rates that allow an organization the option to pay one rate for their entire team to access your content.
You can negotiate custom contracts with partner organizations or you can set standard group rates.
5. Launch Your Content
After you have everything set up, it is time to prepare to launch your content. You could do a grand launch event that you hype up with a strategic marketing campaign, or you could slowly roll out your platform to make your platform seem more exclusive.
Once you launch your platform, study analytics closely. See what content does well and how users respond. Track your revenue to make sure you are hitting your goals. Listen to the numbers and listen to your audience.
When it comes to video monetization, there is no one size fits all solution. Video advertising may feel right to some, while pay-per-view hosting or subscription models work best for others. Successful broadcasters maintain a deep understanding of their audience and monetize content in ways that benefit both them and their viewers.
With those principles in mind, creating a video monetization strategy that works for your business should be relatively simple.
A solid plan paired with a powerful video platform like Dacast allows you to distribute content globally and generate some income. With a built-in paywall and subscription management tools, we take the guesswork out of getting started.
Whether you are interested in pursuing AVOD, SVOD, or TVOD revenue streams, Dacast can help. We offer a FREE, 14-day trial (no credit card required) with full access to our comprehensive streaming and monetization solutions. There are no long-term contracts to sign and you maintain control over your entire content library.
Video streaming is where it is at. Sign up now and give your audience what they want.
For more tips on live streaming and exclusive offers, join our LinkedIn group as well.