Did you know that traditional TV ratings and metrics were compiled using viewer-reported watch diaries until the early 2000s?

Using this crude system, viewers literally recorded which programs they watched and how long they spent watching those shows.

But like everything else in the streaming content world, so much has changed since the OTT takeover.

Now streaming providers have stacks of customer viewing data from their cross-platform apps at their fingertips. The bad news? Many OTT content publishers aren’t leveraging this data to improve their business.

Understanding your cross-platform data and analytics will give you the actionable insight you need to upgrade your user experience and generate more revenue for your team.

So this quick guide provides a rundown of why having a data-informed strategy is the ticket to sustainable growth. And it covers all the metrics you should be tracking to help you make more informed decisions along the way.

Before we get into the nine metrics, below are five reasons your brand should be taking a dive into your data that prove it is worth the time or hassle:

5 reasons data-driven insights skyrocket ott brands

OTT content publishers and streaming providers have been investing loads of money to gather and store their customer/user data. If you’re smart enough to leverage this cache of information, your OTT brand will:

stay ahead of your competition

The streaming content world has never been more exciting — and competitive. US viewers have over 200 OTT services vying for their attention. Now, it’s not enough to boast killer content (though that helps tremendously). You must offer a seamless user experience across multiple devices, personalize viewing recommendations, and correctly predict the next trend (among other goals).

But you wouldn’t launch a new product or service without performing market research, a cost-benefit analysis, and speaking with your department heads. You can pull data to create a data-driven approach to making these informed decisions and stay ahead.

boost your customer experience and engagement rates

A data-driven method for OTT growth shows a complete and total understanding of your target audience. These numbers will show you where/when/how customers find value in your content and engage.

Many OTT brands skip data recon and miss opportunities to understand key metrics about their target audience. This prevents them from engaging with the right customers, at the right time, with the right content/call to action.

After all, you can’t accurately target your subscribers throughout their customer lifecycle, or create a personalized experience, without understanding their needs and behaviors. But the better you know your customers, the better you can create positive user experiences.

Your data paints a portrait of your customers on an individual level and gives a broad overview of your subscriber base. So behavioral analytics, combined with your customer lifecycle engagement rates, optimize user experiences. This data helps you understand your viewers in ways their spending habits can’t always explain.

So as you wade through your customer data, you’ll find all the building blocks you need to create the best experience for your target audience. And as your user experience climbs, so will customer engagement and retention rates (and revenue, yay!).

give developers, sales, and marketing teams actionable data to work with

Data is essential to your product development, marketing, and sales teams. This insight should be analyzed and holistically intertwined with the whole team rather than exist in separate silos.

Shared user data can help:

• Design (or redesign) your app’s user interface to improve UX
• Make product decisions, such as in which countries to expand and which languages to prioritize
• Tackle usability issues across the top streaming devices
• Increase lead generation and customer acquisition for sales
• Enhance customer clustering to streamline OTT content marketing
• Send more targeted messages and create new promotions to spur customer engagement

Using your data to make decisions and measure the impact of those new initiatives will help you see what’s working and what still needs work. That’s why businesses leveraging their data solve four times as many customer requests. Your team can use data to address real-time issues now and analyze trends to anticipate future requests.

Companies that don’t integrate their user-data into decision-making can’t accurately measure the performance or effectiveness of their activities on customer engagement and ROI. So they may just be spinning their wheels.

intelligently allocate funds and entice advertisers

If you’re aggregating content or making content acquisition decisions, your user data will show whether you’re spending money on the right content for your target audience. Which channels should you invest in? Will they have faster payback than others?

If it costs more to acquire/produce your content than you’re bringing in, you won’t have a sustainable business model. So creating a data-informed strategy gives you real numbers to help accomplish these goals instead of guessing about them.

Your user data can also entice OTT advertisers who are looking to make an impact on the target audience you’ve already rounded up. This could be a mutually beneficial relationship for the long-term.

increase your ROI

Companies leveraging their data score a high-level overview of their business and their customers’ needs/desires. These brands optimize and personalize each aspect of their user experience — from marketing to conversions to retention — to reduce costs, increase engagement and revenue, and earn a better ROI.

The results from one survey showed that companies effectively using their data are “six times more likely to be profitable” year over year. And simply personalizing the experience for your users can boost revenue by 10-30%.

Further, these insights can be used to predict your users’ future behavior. Your team will be better equipped to identify and take steps to prevent churn and abandonment before they damage your bottom line. This also means you can more intelligently predict future revenue and growth.

So which metrics should you be analyzing as an OTT content publisher?

north star metric versus input metrics

You probably have different product strategies for your OTT content by release, platform, event, etc. Each strategy should outline three goals for how you’ll: Provide unique value to your customers Meet your users’ needs and expectations Reach your business goals and generate a positive ROI

Tracking specific metrics and key performance indicators (KPIs) can highlight your path to achieving these goals. And there are two types of metrics you’ll need to track:

north star metric: your guiding star to sustainable success

Like the North Star guiding weary travelers on the vast sea, your North Star metric is a high-level metric guiding your brand to greatness in the sea of OTT competitors.

A North Star metric is a KPI that indicates your brand provides value to your customers and generates growth and revenue for the company. Since improving your North Star metric brings favorable outcomes for users and your ROI, it’s one of the best predictors of your long-term growth and sustainability.

Examples of a North Star metric might include the number of new subscribers you capture each quarter or the percentage of customers you retain per year. Stayed tuned for an example of Netflix’s North Star metric below.

However, this broad metric depends on so many other data points known as input metrics.

input metrics: what leads you closer to achieving your north star metric

Input metrics are less high-level than your North Star metric. But improving input metrics means you should be on track to improve your NS metric too. Both improvements will garner favorable results for your team and users.

Input metrics typically include data like time users spent viewing your content, or how many times they log into your app during the week. The more specific your input metrics, the easier it will be for your team to identify and improve them.

how north star and input metrics work together

Analyzing data is all about making meaningful, relevant connections. When you correlate specific metrics, you can build a roadmap to improvement.

Gibson Biddle, former VP of Netflix, said that their North Star metric was (NPS), which gauges customer loyalty and retention[*]. To work on this metric, the Netflix team closely tracked an input metric for “the percentage of new customers who add at least three titles to their Queue during the first session.” For Biddle’s team, this input metric emerged as a strong predictor of retention.

As a result of this finding, Netflix now forces new users to add three titles that seem interesting to their queue before they can begin watching content. This new path gives customers something to watch immediately (i.e., solves a problem), and it inches the team closer to achieving their North Star metric goal.

Performing foundational work like this means researching how your data and metrics line up and work together. These insights will guide your decision-making to help your streaming service grow sustainably.

9 ott metrics you should be tracking

We believe OTT content publishers should be tracking nine specific engagement and retention KPIs, including:

1. monthly active users (MAU)

Monthly Active Users (MAU) is the number of unique users who have opened your app or engaged with your OTT service in the past month. MAU provides an overview of the health of your business, the effectiveness of your marketing strategies, and whether you’re doing things right in terms of managing your customer acquisition, engagement, and retention.

2. customer acquisition cost (CAC)

Customer Acquisition Cost (CAC) is the total cost of acquiring a new customer. Generally, it includes your sales and marketing costs divided by the number of customers acquired. CAC is a very useful metric to help calibrate your investment and ensure you’re making the right decisions for your service’s growth.

Giant streaming services spend a pretty penny on building awareness. To launch Disney+, for example, Disney ran over 5,000 national TV spots, throwing billions into new ad spend just to acquire customers and build their subscriber base[*].

CAC also includes your content production/acquisition costs. Disney spent $24 billion on original programming, Netflix $11 billion, Amazon $9 billion, and Apple $1 billion[*]. Yes, that’s billions.

3. average revenue per user (ARPU)

Average Revenue Per User (ARPU) measures the amount of money you can expect to generate from one customer. It’s calculated by dividing the total revenue of your OTT business by its total number of users.

4. customer lifetime value (CLV)

Customer Lifetime Value (CLV) is the amount of money a customer is expected to spend with you during their lifetime. It’s an important figure to understand as it helps you make decisions about how much money to invest in acquiring new customers and retaining existing ones.

CLV is one of the most essential metrics OTT content publishers must optimize to stay in the green and ahead of their competition. If you estimate a customer’s CLV to be $200, for instance, it wouldn’t be profitable to spend more than this to try to keep the relationship.

5. conversion rate (CR)

Conversion Rate is the number of conversions divided by the total number of visitors. So if your SVOD app receives 500,000 visitors in a month and 125,000 free-trials are created, the conversion rate would be 500,000 divided by 125,000, or 25%.

Conversions can refer to any desired action that you want your user to take. And they aren’t just limited to subscription-based OTT service providers. Conversions for ad-supported providers may include playing a movie or signing up for a free account. OTT websites and apps often have multiple conversion goals, and each will have its own conversion rate.

High conversion rates show that your customers are taking the actions necessary for you to stay in business. These represent the first step on their customer journey.

IBM, although in a different vertical, provides a good example of what can happen when you optimize conversion rates. They took a deep dive into their conversion metrics and discovered strings of behaviors associated with an abandoned cart. When they leveraged those insights to effectively target users in the group failing to complete an order, their campaign successfully drove cart revivals. Just one lifecycle email flow boosted conversions by 5x (compared to a control group that did not receive these messages). IBM scooped up $800,000 in annual recurring revenue as a result[*].

6. abandon rate

Abandon Rate is the percentage of tasks that are abandoned by the user before completing the intended task. The abandon rate for OTT service providers can be the percentage of users who abandon the free-trial process (subscription-based), or it can be the percentage of viewers who exit an app before playing a movie (ad-supported).

In general, you can calculate the abandon rate as the number of abandoned incidents divided by the total number of incidents.

7. churn rate

Churn Rate is the percentage of your customers that leave your service over a given period. It can be calculated by dividing the number of customers you lost during that period (for example, Q3) by the number of customers you had at the beginning of that time period. So if you start your quarter with 10 million customers and end with 9.5 million, your churn rate would be 5% because you lost 5% of your customers.

Churn is vital to understanding the health of your service, and it’s one of the most critical metrics you need to evaluate. The churn rate for OTT services in the US is a staggering 41% (as of Q1 2020).

But you’ll spend more to replace these churned users than keep them. Businesses spend six to seven times more to acquire a new customer than keep existing customers engaged[*].

Customers who see your value will be more likely than new users to continue using your app and renew their subscriptions. One study showed that businesses investing in customer experiences to boost retention earned an additional $700 million within three years.

8. engagement

Engagement measures user interaction with your website or apps. Common metrics can include how many times a user opens an app, how many videos they’re watching per session, and what actions a user takes within one of your digital properties.

Your business won’t be sustainable if it depends on users taking just a single action. Your users must continue to make moves over sustained sessions.

Measuring engagement and user behavior allows you to obtain a better understanding of your customer relationships. Many businesses follow the 80/20 rule: engage 20% of your customers to generate 80% of your business revenue.

read next: [driving ott app engagement through bingeable user experiences](/insights/blog/driving-ott-app-engagement-through-bingeable-user-experiences/?utmsource=blog&utmmedium=blog&utmcampaign=ott-app-metrics&utmcontent=bingeableuxexperience)

9. inactive users

Inactive users are those who were active in the past, but have since become inactive. Why did they leave your app? And what type of retargeting efforts should you take?

A disinterested user may sign up to watch content for a few weeks before abandoning your service for another. Weekly emails or push notifications from your app promoting content they may be interested in could re-engage them.

On the other hand, seasonal viewers may be highly engaged during a sports season or when new episodes of their favorite show hit your platform. However, their interest may wane post-season or when they finish binging all the latest episodes. You can wait until a new season engages these viewers, or you could market other relevant shows and off-season content to add more year-round value.

So in a nutshell, a deeper understanding of your users (thanks to your user data) will help you make smarter decisions to improve your bottom line. But these KPIs aren’t the only ones to pay attention to.

other ott data sources to consider

Just like you wouldn’t make a key decision using only one input metric, you’ll want to assess all nine of those KPIs and the data you glean from:

google analytics and data studio

Data Studio is a free Google tool that gives you an expanded view of your data. You can easily connect to various data sources and visualize your data through highly configurable charts and tables.

With Data Studio, you can connect to data sets such as:

• Google Marketing Platform products, including Google Ads, Analytics, Display & Video 360, Search Ads 360
• Google consumer products such as Sheets, YouTube, and Search Console
• Databases like BigQuery, MySQL, and PostgreSQL
• Social media platforms such as Facebook, Reddit, and Twitter

What’s more is you’ll be able to share these insights with your team and collaborate on reports together.

subscription billing data

Pricing your OTT subscriptions correctly may be your most strategic tool for revenue growth, customer acquisition, CLV, and churn reduction. And an overwhelming amount of customer data transactions relate to changing existing subscriptions, renewals/terminations, add-ons, and upgrades.

So subscription billing services give OTT brands insight into their viewers’ buying patterns. Analyzing subscriber data trends may help your team tailor new offerings and right-fit pricing models based on your real-time usage metrics.

This data will help you retain existing customers, upsell the right customers (think: that 20% from the 80/20 rule), and drive business in untapped or underutilized audience segments.

While you can’t snatch this IP-specific data from a strictly ad-supported platform, you do have other options if you’re in this boat.

ad server data

AVOD providers must check their ad server data to look for ad failure rates, ad blockers, buffering and encoding/rendition quality problems, and ad fraud. These can all interfere with your other input metrics (and ultimately, your North Star metric).

If you’re able to act on this data in real-time when issues occur, you can avoid adverse effects ruining your customer experience. After all, ad failure rates can be as high as 40%, which means almost half of ads don’t create an impression. This will certainly hurt both your user experience and your monetization efforts.

using ott cross-platform data and analytics to expand engagement and boost your ROI

Ultimately, data without insights isn’t actionable. Personalized, data-driven experiences and content are the new standard of customer expectations. These experiences deliver the right content in the right place at the right time in the user journey to influence behavior.

We’ve seen what’s useful and scalable for leading, innovative OTT brands from our work across many industries (retail, financial, media, health, education). And it all comes down to user experience.

Zemoga’s expertise in user experience across both mobile and living room viewing drives discovery and awareness, helps improve engagement and retention rates, and gives brands a head start when utilizing data and analytics to make app-related decisions.

So if you’re ready to build better, we’ve got the right team to launch your cross-platform OTT apps to new heights. And our journey together starts with this click!