People are hungry for content and over-the-top (OTT) videos are leading the way as one of the most popular mediums of consumption.
According to Deloitte’s Digital Media Trends Survey, content streaming platforms saw viewership numbers soar during the pandemic and 80% of U.S. consumers subscribed to a paid video streaming service.
Now, this is great news for content creators because video on demand (VOD) is an opportunity to monetize your content while you create and grow a community. And it’s ideal for these content types:
- Entertainment
- Instruction/education
- Infotainment
- Virtual events
There are a few VOD models to choose from and what’s best for you will depend on a few factors, such as the type of content you want to make, your audience, and your goals.
Now, if you’ve been exploring the world of streaming, you’ll probably recognize these acronyms: AVOD, SVOD, and TVOD.
We’ll walk you through each one so you can get an idea of your options when it comes to video monetization.
Intro to AVOD, SVOD, and TVOD
Advertising video on demand (AVOD)
YouTube is the most popular example of AVOD. This model can work well if you’ve got a large following. The content is free for viewers but is interrupted by ads.
Creators on the platform who have monetized their videos can earn revenue from the ads that run before, during or after their videos.
But if you don’t have a massive audience, you could opt for SVOD or TVOD instead. You have the opportunity to earn a more reliable stream of income.
Subscription video on demand (SVOD)
Netflix and Disney + are popular examples of subscription video on demand (SVOD). It’s sort of like cable TV.
An SVOD subscription gives customers access to a catalog of video content for a specified daily, weekly, or monthly rate.
Transactional video on demand (TVOD)
In the transactional video on demand (TVOD) model, viewers have the option to buy or rent a piece of content.
Amazon Prime uses a combination of SVOD and TVOD because Prime subscribers still need to buy or rent premium content to gain access to it. Other platforms that use TVOD include Google Play and iTunes.
You can also refer to TVOD as pay-per-view because the viewer can just pay for individual videos rather than subscribing to the entire video catalog.
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How to earn income with videos: 3 VOD business models
The model you choose for video monetization will depend on what your goals are. Below we’ll unpack that a little more and discuss the pros and cons of all three.
1. Advertising Video on Demand (AVOD)
AVOD has a low barrier to entry and allows you to reach a massive audience. Since there is no subscription, monetization comes from ad revenue.
A few of the most popular social media platforms that offer video monetization are YouTube, Facebook, and Instagram.
YouTube monetization
YouTube is the most well-known AVOD platform where creators can also bring in sponsors to earn an additional income with their videos.
And although this is the most popular path to video monetization, there are still eligibility criteria you must meet to get accepted into the YouTube Partner Program.
Eligibility criteria to join the YouTube Partner Program (YPP)
- Follow the platform’s channel monetization policies.
- Be in a country/region where monetization is available.
- Have no active strikes on your channel.
- Have more than 4,000 watch hours in the last 12 months.
- Have more than 1,000 subscribers.
- Have an AdSense account that’s linked to your channel
Check out this video to learn more.
Facebook monetization
In March 2021, Facebook announced content monetization options.
Eligibility criteria for Facebook video monetization
- Be at least 18 years old.
- Live in an available country and produce content in a language that’s listed.
- Publish from a page, not a profile.
- Have 600,000 total minutes viewed in the last 60 days. Paid watch time, views from boosts, or crossposting doesn’t count.
- Have at least five active videos. This includes on-demand or previously live videos but does not include crossposted videos.
- Post videos that are at least one minute long.
- Have at least 10,000 followers
Learn more here and watch Uscreen’s helpful video if you’d like:
Instagram monetization
Instagram made video monetization possible for creators in 2020.
The options include earning revenue from ads on IGTV content and via Badges in Live streams and Live Rooms.
Instagram has partner and content monetization policies you’ll need to thoroughly check out.
Other OTT AVOD platforms include Pluto TV, Xumo, Vudu, Crackle, and Tubi.
AVOD pricing
Generally free for viewers or you could adopt for a hybrid SVOD and AVOD model—like Hulu with ads—which is offered at a reduced monthly membership price.
Pros of AVOD
- Doesn’t require a ton of investment or technical knowledge to get started.
- Makes your content more accessible because it’s free.
- Lets you build a large following.
Cons of AVOD
- Unless your videos get watched thousands upon thousands of times, you’ll only make pennies in return.
- Viewers may get irritated with constant ad interruption.
If you’re looking to establish a more reliable stream of income, one that isn’t dependent on the sheer volume of views, then AVOD may not be the best model for you.
Next up, SVOD.
2. Subscription video on demand (SVOD)
If you plan on making a library of content that can be streamed over and over again, such as master classes, then an SVOD model is a great option.
It allows you to offer your audience long-term contracts, similar to satellite or cable TV.
The subscription then gives your viewers access to an entire catalog of content—Think Netflix.
This model is the most lucrative because if subscribers are happy with the service, they will stick around for more. And so, each user becomes a consistent source of income.
Here are some tips if you’re going to adopt the SVOD model for video monetization:
- Develop a cadence with your followers so they know when to expect new content, and notify your subscribers when you add new videos.
- Create niche content to develop a dedicated following.
SVOD pricing
You can offer monthly or yearly subscriptions. You can also decide if you’d like to offer a free trial.
You could also offer a low-stakes limited membership plan (a freemium version) where sample content is free.
You could convert the freemium users to opt for the full paid membership if they enjoy your content.
Pros of SVOD
- Lets you offer flexible subscription options
- Allows you to build a dedicated following in a specific niche
- Lets you publish exclusive content
Cons of SVOD
To hold onto subscribers, you’ll have to post relevant video content regularly.
If you can’t keep up with the demand (in terms of quality and quantity), your viewers may think they’re not getting their money’s worth and unsubscribe.
3. Transactional video on demand (TVOD)
The TVOD model lets you offer your video content for purchase or rent—ideal for exclusive releases.
This model is great if you want to build a larger audience because anyone can buy your content and the price options are flexible without any long-term commitment.
TVOD pricing
With TVOD, you can package your content as you like and offer it for a fixed price.
Viewers can have options to purchase specific content (available for download or lifetime access on the platform) or rent it.
Pros of TVOD
- The option to buy or rent specific content attracts a large audience.
- Give you the freedom to offer exclusive content like a series or feature film.
Cons of TVOD
- Retaining viewers is hard.
- To attract more people, you’ll have to invest in marketing, which may lead to a higher expense on your end.
Best video monetization platforms of 2021
The OTT media arena is booming, Statista reports that industry revenue is expected to reach over 210 billion USD by 2026—more than what was generated in 2020.
So, it’s as good a time as any to dive into the VOD playground. But before you do, put some thought into the platform you choose.
Here’s a quick round-up of the most popular options.
1. Uscreen
Uscreen is an all-in-one video monetization and OTT platform. It offers video content creators full ownership and the opportunity to build and launch a standalone video membership site.
2. Patreon
Patreon is great for membership-based content. You can set multiple tiers and offer tailored content for each price plan.
YouTubers often set up a Patreon as well. It allows them to establish a dedicated following that’s more lucrative.
3. YouTube
YouTube is generally the first choice for new video content creators. Once accepted into the YouTube Partner Program, you can monetize your video through ads, SuperChat, SuperStickers. You may also earn from YouTube Premium revenue
Learn more in this great video by Sean from Think Media.
Read more: How to Get More Views on YouTube
4. Vimeo
Vimeo offers monetization through subscriptions and pay-per-view. It also gives you an option to monetize live streams with their higher plans.
Some of the platform’s other features include a customizable video player, an option to embed video player URLs anywhere, and advanced analytics to track video performance.
Read more: Vimeo Basic vs Paid
5. Wistia
Wistia is a VOD platform, which offers subscriptions, advertisement, and one-off monetization methods.
It can also be integrated with membership tools such as MemberMouse and offers a page builder to help you create a personalized brand image.
Read more: Vimeo vs Wistia for Professionals
6. Twitch
Twitch is a live streaming platform that offers a variety of monetization options. Some of these include Subscriptions (aka Subs), Gifted Subs, Emotes, Donations, and Ads.
VOD on Twitch is an archive of previously live content. Enabling it can help you grow your audience because it gives your previously live content a chance to get more views.
That’s all
We hope this blog helped you understand your options for OTT video monetization.
If you need help creating video content, then feel free to contact us. Our team would love to brainstorm ideas and bring your vision to life.
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