December 1, 2023
4 min read
Streaming platforms are helping businesses redefine how they engage with their audiences by combining the best of the traditional television model (live events) and the interactive capabilities of the digital world. This article highlights four ways streaming live events can benefit businesses and users.
Since the mass adoption of streaming platforms, cable has taken a back seat with one exception: live events. For decades, we’ve associated live events with linear cable. We’re used to seeing major league sports games, award ceremonies and reality competition shows broadcast live on cable networks. Cable providers rely heavily on the revenue generated from live events like sports; in 2022, live sports events comprised 94 of the top 100 most-watched cable telecasts.
In an era of streaming increasingly reliant on advertising revenue, however, live events are taking over the OTT landscape. Netflix recently announced a live golf event with Formula 1 drivers and PGA tour pros; Max has launched a live sports tier to its platform housing coverage of the NBA, NHL, MLB, and more; Hulu’s OTT TV+ offering is now home to the Oscars, Grammys, and Emmys – the list goes on.
Essentially, streamers are taking the best of the traditional TV model, where big moments bring in big audiences and a sense of cultural relevance, and applying it to OTT. The technological abilities of streaming enable content owners and rights holders to better engage and retain users while generating promising revenue for the brand. Below are four opportunities that live events provide for businesses and users alike.
In a business landscape where many streamers are reporting higher average revenue per user in their ad-supported tiers than their standard subscription tiers, ad impressions have become a more vital metric for success than subscriber numbers. Scheduled live events promote appointment viewership, which brings large audiences to the same place at the same time. This, in turn, provides a lucrative opportunity from an advertising and sponsorship perspective. Tentpole events like the Super Bowl, which generate roughly $500 million in ad revenue in a single evening, prove this point.
This dual revenue stream (subscription fee + advertising revenue) imitates the long-successful business model of legacy TV, wherein income was tied directly to consumption. As streamers inch their way towards profitability in an aggressive market, live events both large and niche will prove valuable from an advertising perspective.
Beyond ads and subscriptions, pay-per-view (PPV) is another effective avenue to monetize content. Live PPV programming can be leveraged across industries; examples include WWE’s WrestleMania, esports tournaments like the League of Legends World Championship, or Amazon Prime Video’s single-purchase comedy specials.
PPV provides a simpler, more predictable revenue model wherein content owners have the flexibility to price content according to its value. PPV offers the potential for significant revenue generation: in 2015, the highly anticipated Floyd Mayweather vs. Manny Pacquiao fight raked in 4.6 million PPV purchases and $410 million in revenue, making it the highest grossing PPV fight of all time.
Livestream shopping has established itself as a successful model in countries like China, where live commerce accounts for 19% of all online retail sales. Although the U.S. market hasn’t reached
Livestream shopping generates conversion rates up to 10x higher than that of traditional e-commerce, with the U.S. seeing an average conversion rate of 33%, and 40 to 54% of frequent live commerce users reporting they typically make a purchase during the live stream itself. These shopping events, most popular in the fashion and beauty sector, often take the form of runway shows, influencer or celebrity try-on hauls, or sit-downs with designers as they explain the inspiration behind their collections.
With interactive capabilities like Q&As or live chats, livestream shopping is a great way for brands to not only generate revenue, but build hype, engage viewers, and nurture a relationship with the consumer.
Live commerce can also be built into live events whose main purpose isn’t the shopping itself. During a livestreamed concert, for example, users could purchase the artists’ album or merch. And in sports, a fan could be prompted with an in-stream pop-up allowing them to purchase a jersey of the player who just scored.
Interactive Community Features
One goal of streaming destinations today is to bring the user closer to whatever they’re watching, be it a game, a comedy show, or a fitness class. For users, real-time interaction – with one another, performers, merchandise, and more – is a large factor in feeling immersed in the experience. Live e-commerce is just one of the many interactive capabilities afforded by digital delivery models. On top of live shopping and Q&As, streaming platforms can also explore features like community chats, real-time analytics dashboards, and the ability for users to “react” with likes and dislikes.
The metaverse provides a great example of what the future of interactive, immersive live events could look like: Ariana Grande’s virtual, in-game concert hosted on Fortnite, which amassed 78 million attendees, included a merchandise store and mini-games for users to interact with throughout.
The Bottom Line
By blending the best of traditional television with the interactive capabilities of the digital world, streaming platforms are redefining how businesses engage with their audiences. The multi-faceted live event approach, encompassing advertising revenue, Pay-Per-View models, e-commerce, and interactive community features, not only generates substantial income but also fosters a sense of real-time connection and engagement for users.
As the streaming landscape continues to evolve, live events will reshape the future of digital entertainment, creating immersive, interactive experiences that captivate audiences worldwide.