Decoding Pricing Offers - YOUKU Online Video Service
Case 2 - Diving into subscription-based pricing for East Asian Dramas.
Most of you reading this probably do not know the application YOUKU, unless you live in China. I found out about it only yesterday.
Growing popularity of C-Drama
Over the last couple of years, Chinese dramas, also called C-Drama, have started to grow in popularity, alongside their already extremely popular cousin, K-Drama. C-Drama are slower paced, have more episodes, are 45 mins long vs 60 mins for K-drama, and equally enjoyable.
A quick search on TIME magazine´s website reveals that the number of results for Korean drama are 2860 and for Prince Harry are 4080. Korean dramas, and as an extension, East Asian dramas have grown exponentially in popularity over the last few years.
The half-point thumb rule.
While each drama is different, there is a rule for any K-drama (and this loosely extends for C-Drama as well). At the halfway point, the leads would typically realize their feelings for each other or there would be major plot twist or a semi climax at around the halfway point. This is rather exciting when you´re knee-deep, invested quite a bit into the plot, storyline, chemistry between leads etc.
This particular analysis was done for the drama ´The Double´, released in June 2024.
Netflix vs YouTube vs YOUKU
Netflix releases 4 episodes each week - which would normally be okay as we are all used to this format by now.
But as hooked and knee deep that one can get by the halfway point, it´s common for a person to search for other streaming platforms for more episodes.
Incidentally, YOUKU released 22 episodes (HD) on their official YouTube channel at one go. By comparison, Netflix released 12 episodes until last week, with 4 to be released every week for the next 2 months.
YOUKU´s clever strategy
On YouTube, YOUKU did a clever job pushing their agenda of ´watch all episodes, download our app now´. So, for 10 episodes, from 13 to 22, YOUKU had subtle branding (not like Aerial as I write about later).
After consuming all 10 episodes on YouTube (we have the premium version so I didn´t have to watch any ad), I wanted to check what the next step in the viewer´s journey would be. (I couldn´t stop. Its´s like Lays).
YouTube didn´t have any more content. YOUKU was confident that if they leave us hanging at episode 22 (close to the half-way point), we will search the universe for the next episode. I was directed to a glitchy platform (dailymotion) where I started with episode 23.
These episodes are all 45 min episodes, and every 8 mins, on dailymotion, I was shown 2 back-to-back advertisements which I couldn´t skip. That´s 11-12 ads every episode. I was shown 7 ads of Aerial in total for episode 23, it was almost impossible to watch the rest of the episodes on this platform. I closed the glitchy platform. I realized if I wanted to continue watching I would have to go to the source. There was no other way.
I remembered that I could watch all episodes on the app YOUKU (thanks to the branding on YouTube). I downloaded the app. The UI was super easy, and I quickly realized that I could watch 22 episodes for free. The others were locked. 22 was the magical number (same as what they uploaded on YouTube).
YOUKU´s pricing
For unlocking all 40 episodes on this app, I had to pay a subscription fee. By episode 23, you´re halfway through the drama. There´s no going back.
I clicked on the subscription button.
For the 1st month, it was 50% off. I had to pay only 3 USD. I did it. I will have to pay 6 USD from next month onwards if I want to continue.
The price for watching the remaining 18 episodes on YOUKU ad-free was 3 USD. No men in lab coats - no Aerial ads. Absolute win.
I like YOUKU´s strategy. They limit the free content until you are absolutely hooked. And then they charge you, first, a small fee and then, the regular fee.
They give you a slow (4 episodes per week) preview on Netflix or 22 episodes on YouTube, by which point you´re too far in. Then as you search for where to see the rest of the episodes, you are automatically guided to their application where you would most likely subscribe. YOUKU gets visitors from outside China thanks to Netflix and YouTube, which is exactly their strategy.
This works for extremely well-made dramas like The Double where after each episode, you´re searching for the remote to quickly hit the next episode button. Well done YOUKU.
I could have subscribed to Viki and also have watched all the episodes, but I would have had to pay $5 instead of $3. Viki is more established, and doesn´t have a promotion for new joiners. This also means that YOUKU has a more aggressive strategy to acquire new customers.
It was interesting to observe that neither Viki now YOUKU had a free trial. I would 100% have signed up and cancelled it after watching my favorite drama if there was.
As popularity for Chinese dramas rise, platforms such as YOUKU and Viki will naturally see a huge rise in subscriptions. There are other platforms as well, but Viki is one of the largest internationally, and YOUKU is the one of the largest within mainland China and now looking to expand (which is why they have 50% off for new members and 22 free episodes on You Tube).
China is a relatively closed country in terms of content restrictions, but these platforms bridge the gap to the outside world and bring us some fine dramas.