Platform bundling, a trend to look out for?
Bundle deals are all the rage of media consumption, and even see would-be competitors joining forces for consumers’ straying attention
A free YouTube Premium membership for three months with your smartphone purchase, an Amazon Prime Video Mobile access with your Airtel recharge, and a Mubi and or Lionsgate Play subscription option on your Amazon Prime Video account. Bundle deals are all the rage of media consumption seemingly, and even see would-be competitors joining forces for your straying attention.
A bundle deal basically refers to offering several products or services together as a combination rather than separately as individual units. There may or may not be an option to buy each unit separately, but when sold as a bundle, they are collectively sold at a lower price.
Neeraj Sharma, Senior Vice President – Planning, L&K Saatchi & Saatchi observes, “There was an interesting article in The Washington Post this month which argued that how OTT which started with being anti-TV, providing fresh content and not cookie-cutter shows, have now started resembling more to cable with types and spread of content. While this was from the perspective of content, if you look at the OTT landscape in India, there are currently 46 OTTs each with their own subscription plan and freemium model. So now deciding to watch OTT has become like browsing TV channels to find something worth watching.”
Sharma adds that this era of expansion almost always follows with an era of consolidation to make a business sense and be accountable to stakeholders. That is what has started happening in media, content and OTT market.
Raghav Bagai, Co-Founder, Sociowash, adds that bundling often helps brands to expand their TG and consumer pool. “The basic principle behind this being that an ocean is nothing but an accumulation of millions of small droplets. It enables companies to sell more of their products, increases the average sale value and reduce drop-outs. These bundles play on the consumer psychology of getting more satisfaction by paying less for a larger number of products, luring people into buying them and further habitually purchasing the same number of products for the foreseeable future, even if at a slightly higher price than before,” he says.
Indeed, bundling actually helps advertisers reduce the cost per reach for related products, similar products or suggested products that can be bought together. “It expands the TG by attracting the attention of unexpected audiences at a fairly negligible cost - thereby aiding marketing goals and reducing the burden on marketing budgets. A person looking at product A will automatically be tempted to look at products B & C if suggested at the right time, place and in the right combination. So at the cost of reach for product A, products B & C also benefit,” points out Bagai.
Mitesh Kothari, Co-Founder, and CCO, White Rivers Media, notes that almost half of the people streaming on OTTs subscribe to multiple platforms because no single platform has all the content they want. “Collaborating with competitors might seem counterintuitive initially, but it's a great way to eliminate competitive anxiety while still being driven to achieve results. Content creation requires immense effort, innovative ideas, capital, and time. By tying up with similar platforms and sharing their inventory, OTTs can now reach new audiences, create new content, expand their range of genres, and serve a broader user base,” he says.
Moreover, the plunging data rates and the rising penetration of smartphones in the country suggest that people will only be spending more time on OTTs in the future, so platform bundling is a trend to look out for.
Sharma says that while there may not be advertising if you are paying for the bundle but if there is, the new age tech companies are more interested in behavior based targeting than demographic based targeting.
“Based on who is watching what (the way Netflix does by making you choose your profile when you open the app) advertisers would be able to target them better. There are dedicated apps like OTT Play or Fleek which are “subscription marketplaces” basically an Amazon of OTTs. They are not content creators but content-bundlers or aggregators. That’s their business model. I think that’s one possibility and the other is merger and acquisition. And the third possibility is becoming what you started against – becoming a TV channel with myriad options and packs, which I hope doesn’t happen,” he concludes.
