/ An inside look at the business of digital content
How Vix fueled 10x audience growth with Hispanic audiencesDecember 17, 2020 | By Peggy Anne Salz, Founder and Lead Analyst – Mobile Groove @peggyanne
The proliferation of on-demand platforms and services combine to drive what Nielsen calls “the most profound media disruption of the last half-century.” Record-high audience numbers and time spent using streaming services and apps add up to make 2020 the biggest year yet for streaming.
But the real growth could be in serving culturally relevant content to underserved audiences such as Hispanics, which now make up nearly 20% of the current U.S. population. It’s a demographic that demands balanced content and appreciates diverse views and voices. It’s also an audience of cord-cutters that uses streaming services, smartphones and apps. During March, Hispanics increased their weekly viewing of movies or TV shows using a streaming service by “about 8 hours.” That’s well above the numbers reported by non-Hispanics.
It will be a stretch for many mainstream content companies to bulk up on content and capabilities to cater to this mobile-first audience with culturally relevant content. But not all companies will be in catch-up mode in 2021. Vix, a free Spanish-language ad-supported video-on-demand streaming service (AVOD) company founded in 2016, has a significant head start.
Inside Vix’s success
The move to acquire Pongalo, a market-leading Hispanic AVOD, in August 2019, has established Vix as the largest Latino AVOD player in the world, growing its audience more than 10x. Today, Vix, backed by Discovery Communications and HarbourVest Capital, creates, acquires, and distributes Hispanic-focused content to audiences in the U.S., Latin America and across the globe. It counts over 20,000 hours of Latino-focused films and TV shows.
Blockbuster and premium content is a crowd-pleaser. But it’s the company’s social media footprint, which includes 100 million Facebook followers, that keeps audiences engaged. Importantly, social media is also the motor that drives customer acquisition and allows a modest 50-person ad sales team to achieve ambitious growth targets and expand efforts to Brazil.
The company has also grown the number of partnerships (Amazon, Google and Roku). The top-ranked app (the #1 most downloaded entertainment app on Android devices in Mexico ahead of Netflix) recently became a top-five free film and TV streaming app on Roku in the U.S. Vix is the first-ever free streaming app to hit that benchmark.
Continuing our series of DCN video interviews, I talk to Rich Hull, formerly the CEO of Pongalo. Hull, now the Head of Streaming Platforms and Chief Strategy Officer at Vix, received Variety’s Dealmaker of the Year honors for his part in architecting one of the most significant media deals of 2019. He is also instrumental in growing Vix’s platforms and partners.
In this interview, we discuss why all media companies must acknowledge the demographic revolution and the requirement to serve up culturally relevant content to 60 million Hispanics in the U.S. alone. We also debate the future of streaming, the role of personalization and the business benefit at the “collision of advertising, international and content.”
Here are three key takeaways from our talk:
Drive discoverability through platform diversity
U.S. Hispanics are ahead of the curve when it comes to digital. They lead in the adoption of new devices and services. And they are the power users of mobile and over-index in video consumption.
To keep pace with consumers and cater to a growing and global audience for Spanish language content, Vix has maintained a mobile-first approach. It’s all about choice and letting consumers decide for themselves how they want to consume our content, Hull says.
To date, Vix is available on multiple platforms including Apple TV, Fire TV, Roku and connected TV devices from Samsung and Vizio. “We’ve put ourselves there so that they can discover us.” Following this strategy has allowed Vix to “punch above its weight” and leverage partnerships to build scale. Amazon counts Vix as its biggest supplier of Hispanic content, Hulls says. It’s more than an accolade. It’s also an inroad to Amazon’s Alexa, a platform Hull says is important for his company – and many others – to extend the brand and win new audiences.
Tap social media to fuel your audience growth flywheel
Social media presence boosts awareness and buzz. But there’s no reason to stop there. Vix has tapped its community to create a new kind of funnel, Hull says. The audience of 100 million Facebook followers alone is one that Vix cultivates and activates with content. “It’s a really massive audience that we can speak to and it’s a very powerful megaphone that we have,” he explains.
At a high level, Vix works with major brands to create content and branded entertainment to amplify key messages and recruit audiences. “So we’ll do things like say: Here are the top five J-Lo movies ever made and, as it turns out, we’ve got two of them, so click here to install our streaming service.’” The outcome, he says, is a “very elegant way to drive people down the funnel.” It’s also helping Vix increase organic reach and reduce dependence on Facebook or Google or Apple search ads to target audiences.
Engage consumers by making free content the “front porch” of your offer
In the search to find the right mix between subscription models and advertising companies, Hull says companies should widen the aperture of how they view the potential of free content supported by advertising. He points to the example of NBCUniversal. Rather than compete head-on with Disney, AT&T’s WarnerMedia and others that have launched subscription-based on-demand services to compete (or at least catch up) with Netflix, NBC has launched a free, ad-supported service. Free doesn’t just bolster audience numbers, he says, “As the space evolves, where [streaming] is monetized with ads, it is also becoming a better user experience.”
In addition to challenging the viability of locking content behind a subscription wall, Hull also debunks the myth that original content is the way to win audiences. Granted, Game of Thrones and original content has paid dividends for Netflix, but it’s a competitive space where smaller players can go broke fast. Instead, Hull advises companies to keep content free, and bottom lines in the lack, by curating quality content, not creating it. “For us, it’s about volume and choice,” he says. The value is in curating content in a “very authentic way.”