Before the battle of the live-streaming apps Meerkat and Periscope, live-streaming video platform Hang w/ had close to 2 million downloads of its iOS and Android apps.
Although Hang w/ hasn't generated the same level of attention as newcomers Meerkat (which has about 2 million users) and Twitter’s Periscope (which has about 10 million), the incumbent’s ad products are more mature since it launched in 2013.
“We set out to create tools for the broadcaster and for the creator to enable them to do public or private streams and monetize,” said Andrew Maltin, CEO of Hang w/ and MEDL Mobile, a mobile app developer with agency services. “We are platform agnostic and keep adding third-party distribution channels. We’re fans of letting people use Hang w/ as a tool to broadcast to any platform they’re invested in building a following.”
Its newest monetization effort is pay-per-view pricing, which allows video creators to charge between $.25 to $100 for streams, which Hang w/ expects will diversify its revenue stream through more of a recurring pricing model than standard CPM-based pre-roll.
Pay-per-view streaming is a relatively uncharted pricing model in the live-streaming space. Although YouTube experimented with the pricing model a couple of years ago to help monetize live event streams, it’s still a novelty.
It’s possible to see how a sports network could take advantage of a pay-per-view live stream by offering never-before-seen footage or allow users to unlock special content.
But despite the obvious challenge of charging users to stream clips in real time – will consumers find the content engaging enough to pay for it? – Hang w/ must also evaluate which formats benefit broadcasters most without encroaching on the consumer experience.
Brand-sponsored videos have proven valuable for companies like Herbalife and the UFC.
“Our pre-roll now has a 10% click-through rate, but we’ve seen instances where some of our power uses are driving 25% click-through,” said Mazen Alawar, Hang w/’s marketing director, who compared its rate to the much lower industry average of 1% or so.
But he acknowledges 30-second pre-rolls aren’t exactly a great user experience. Because it takes the average user six seconds to complete a live stream, Alawar thinks ads should mirror those load times.
A History of Hang w/
Hang w/’s main point of differentiation from Periscope and Meerkat is that users can live stream video across Facebook, Twitter, YouTube, their own sites or within the Hang w/ app, as opposed to being relegated to a single platform or web client like its competitors.
Hang w/ began as a bullhorn for celebrities like rapper 50 Cent and actor/musician Jared Leto to share music videos or personalized messages with fans. It offered these celebrities a cut of the revenue from pre- and post-roll ads that ran against their streams.
The only problem was that not every creator on Hang w/ was a celebrity. And similar to all live-streaming apps, the biggest quagmire was ensuring users had enough quality content to view in the first place.
“We’d have one big celebrity who’d tell their audience, ‘Come follow me on Hang w/,’ and they’d get this spike of users,” Maltin said. “Then it would drop back down when the viewers waited for him to broadcast again. Our retention rate was not where we wanted it to be.”
One way the company mitigated the content challenge was to curate live content through a Discovery platform and introduce an archive system, which deviates from other popular live-streaming apps whose videos virtually disappear after a set period of time. Creators on Hang w/ have the ability to archive video permanently or for as long as they prefer.
Hang w/ uses an integrated ad server, which it says helps improve targeting.
“We’re using DFP [DoubleClick for Publishers] to serve our ads and we’re tagging our content and classifying whether it’s premium or user-generated content,” Alawar said. “Obviously you want a different ad running in front of Ne-Yo than in front of me. We are increasingly targeting it on the individual level because, through our Facebook Connect product, we have a lot of data on people.”
Feeding The Live-Stream Frenzy
Maltin says the biggest barrier to live-streaming video catching on at scale with brands and broadcasters is consumer adoption. Although it’s still early for live-streaming video, technology improvements in mobile bandwidth, the shift from Flash to HTML5 and the speed to upload content are propagating it.
“Another reason people are interested in this now is because of the need for authenticity in social media,” he claims. “In our minds, the live stream is totally authentic and there are less ways to fake it. People are noticing the artificial connectivity between fans and some of these big creators or celebrities” who are paid to endorse products.
While brands like GE and JetBlue have experimented with live-streaming video, “few have done so with any sustained effort,” noted Jay Wilson, a research director at Gartner.
Media companies, however, have had greater success because they have better access to a steady stream of content to feed the beast.
“Whether ad dollars will follow really depends on the quality of content,” Wilson predicted. “If one sets aside programmatic ads, which follow targeted eyeballs, broader opportunities for marketers will come if Periscope, Meerkat, Hang w/ and now Facebook Live attract high quality content creators.”