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The Underestimated Value of Content

The Underestimated Value of Content

June 21, 2016
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" The importance of great quality, targeted, immersive content is a question of basic maths (and profit). "

Back in the early 2000s, I was lucky enough to be working in a very creative digital design agency in New York. In these heady “media” days, the standard slogan was always: “content is king.”’ It was always up there in the value chain.

Content was, and still is, the key factor in any digital marketing, design or service. It creates customer value and loyalty; it increases ARPU (average revenue per consumer), extends subscription life, creates better brand positioning and basically brings in more cash.

And that makes sense! Customers don’t care about traffic buys, subliminal marketing or whether the site was built in HTML5 or JavaScript. All they care about is that they are getting something very close to any preconceived ideas they may have had!

In the case of adult entertainment, for a consumer this means one of two things:

  1. Great content that will turn me on and I know exactly what I want right now (a searcher); and,
  2. Great content that will turn me on, but I want some suggestions (a browser).

Which, from a service provider standpoint, would equal these two things:

  1. Great content; and,
  2. Great navigation/retailing.

And yet in web and even more so in mobile — this basic premise of the “customer is always right” seems to be eroding in exchange for a more “churn and burn” philosophy of customer acquisition.

The importance of great quality, targeted, immersive content is a question of basic maths (and profit).

In early May, Fiksu released a report saying that in March 2016, the average cost to acquire a mobile user was $3.21.

It seems logical then that upselling to this customer (who has already shown he likes our service/product by buying something) is easier, cheaper and holds a greater chance of success than going out and acquiring another new customer for $3.21, who knows nothing about us yet.

If this is the case, wouldn’t it indicate that considerably greater profit margins can be achieved if that customer renews his subscription or we convince him to buy something else from a product range he has already shown interest in and committed to with a purchase.

Add some smart retailing, navigation and profiling to this scenario and any upselling we do can be so targeted to him specifically, that it’s harder for him to say no than yes.

And yet in the new mobile era of entertainment, we are seeing instead that actually traffic is king, with many D2C (direct to consumer) service providers allocating anything up to 80 percent of their budget to traffic and only a mere 20 percent for everything else (including content).

I get the basics of why this is the case of course — with the targeting that’s possible today, the churn can be reduced and of course if your plan for the service/product is short-term, then content has less value and you can reduce your service running costs.

However, if you were to spend a little more on great content resulting in your customers buying more, spending more time using your app or staying subscribed for longer, you are greatly reducing the need to constantly get (and pay for) new customers.

Your ARPU will be much higher for a much lower investment.

In addition, that customer base that you nurture with great content and regular updates becomes hugely valuable in itself in terms of data, ad placement revenues, etc.

At the end of the day, it comes down to whether the service provider is building a long-term business or short-term win with the service he is creating — and I’m not denying there is a case to be made for both. It depends how you want to position your mobile business.

What we found incredibly positive at this year’s Mobile World Congress and The European Summit in Barcelona was that:

  1. There seems to be a new vested interest in the value and importance of great content; and,
  2. There were so many more new mobile service providers this year who are looking at their products as a long-term investment in a loyal, high-spend customer base.

I had leading mobile veterans tell me that video content specifically was one to watch in 2016 and not just marketing videos — original content that has context in its environment.

Moreover, I think it is the key for any content creator, supplier or licensor who wants to put the value back into content and regain our place at the top of the value chain — it’s about creating content inline with its environment!

And this is where maybe many are getting it wrong — the “environment” has changed, almost unrecognizably, from where it was just 10 years ago.

We have now passed the mobile tipping point where more people are accessing services via their mobile rather than via their desktop computer and this will only continue to grow as the millennium generation (who only use mobiles outside of school or work) grow into adults.

So content should be designed to match this new environment and its audience. How do users use their mobile for entertainment and video content and how does that differ from desktop or broadcast?

Then create content that matches those natural behavioural patterns. Simple examples for the adult industry in mobile would be:

  • Localization of mobile;
  • Grading regulations;
  • Duration of average viewing; and,
  • Differences in requirements for navigation and discovery.

And within those simple contextual rules, what creates the biggest value for the customer? If for example, you can’t show anything other than bikini/non-nude content in one of the fastest growing mobile revenues in the world (India), how do you create immersion, fantasy and value within that restriction?

If we get that right, then I don’t see why content can’t take its rightful place on the throne once again!

Long live the king!

Julia Dimambro has spent the last 19 years in digital communications and 14 years specifically in mobile entertainment. Dimambro founded Cherry Media in 2003 in order to create and deliver innovative, consumer-focused mobile entertainment. It owns and operates the world famous, multi-award winning mobile erotic entertainment brand, Cherrysauce. The company is entirely self-funded, 100 percent owned by Dimambro and has been profitable since launch.


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