Video-on-demand business

Video-on-demand is quickly gaining momentum and surpassing all other traditional media outpacing other media channels. Whether you are just starting out in the video-on-demand industry or an established player, who does not want to be a more successful entrepreneur? For those prepared to work hard, there is an almost formulaic blend of things to consider that can set successful entrepreneurs from the rest. How to start a video-on-demand (VOD) business and take it to new success heights? The key to succeeding with your VOD platform is to launch it with a clear business plan.

Here are some of the important things to consider before starting your video on demand business. 

What to consider before starting your video on demand business? 

If you are thinking about how to start a video-on-demand business, it is important to look at key factors that help to grow your streaming service. Let’s get started. 

Choice of niche

The choice of a niche will define all your subsequent strategy in launching your video-on-demand business. When starting out, you need to decide whether to offer a mainstream platform or a set of niche content.

Choosing a niche will help you stand ahead of the competition. Of course, a niche makes your audience smaller but that often implies a stronger community. What exactly is a niche video-on-demand platform?

Let’s look into a few examples to comprehend the concept in a better way. Qwest TV is a subscription video on demand platform featuring Jazz and eclectic music. 

Alone in its niche, Qwest TV is focusing on the community of Jazz fans across the world since 2017. Like Qwest, more and more niche VOD platforms are likely to emerge as they are unique and target a specific audience who are interested in a particular subject.

Due to the small audience, it is easy to be the brand ambassadors of the niche you are targeting as well. On the other hand, the mainstream remains risky. Targeting a mass-market often requires huge investments and it means directly competing with the industry giants already in place like Netflix, Amazon Prime, Disney plus, etc. 

Define the business model and revenue strategy

The video-on-demand business offers flexibility possible to entrepreneurs for content monetization. If you take the giants, Netflix and YouTube, you can see that both of them follow a completely different type of monetization strategies. While YouTube primarily streams VOD content with its Advertisement model, Netflix follows a subscription-based business model (SVOD). If you take a look at their annual revenue, Netflix generated a total of over $ 15.8 billion in 2018. Whereas Youtube’s net advertising revenue is expected to hit $5.47 billion in 2022.

The success of any VOD platform lies in its revenue model along with other aspects like the business plan, content strategy, current market scenarios, and more. By choosing the right business model, you can expect your business to reach new heights even when your competitors are exceptionally performing in the market. 

Conduct a detailed study of the business model followed by your competitors before choosing the best option for your own conduct. If you ask which is the most successful business model, the answer depends on your audience base, type of content, depth of your catalog, catalog renewal, and a lot of other factors. However, the trends in the video on demand market over the past few years are moving towards the SVOD business model following the paths of sites like Netflix

Here are 4 common revenue generation models that major VOD platforms follow. 

Subscription video on demand (SVOD)

SVOD is perhaps the most popular revenue model that allows viewers to enjoy unlimited streaming for a subscription fee. Netflix is an ideal example of a VOD provider who follows this business model. 

Advertisement video on demand (AVOD)

AVOD is the business model that offers VOD content free to users but with the interruption of advertisements. These types of platforms make money by collaborating with advertisers and brands. YouTube is one of the most successful AVOD platforms. 

Transactional video on demand (TVOD) 

TVOD is also known as pay per view where your users pay for access to individual content they want to view. Most businesses that run TVOD services do not rely on a single revenue model. Apple iTunes is one of the best examples of a TVOD service. That makes our next type of VOD model- the Hybrid VOD model. 

Hybrid VOD model

The hybrid VOD model is nothing but a blend of two or more or all of the three models we discussed above. A popular example is YouTube itself. Take YouTube premium, for instance, YouTube offers a membership plan for its audience to watch ad-free and offline videos. 

Setting a price

After choosing the right business model, setting a price is the next important thing to consider. It is a real strategy. The price position will have a significant impact on two areas- Marketing and Profit.

If you position your services below the ideal market price range, you are significantly reducing your margins. But this will bring in more customers to you. So this works if you want to increase your customer base soon after launching your VOD platform. However, sometimes pricing low can also give an impression of poor quality content.

At the same time, if your price is higher than the market standards, it gives a perception of high value, but with the chance of disappointing some customers. As always, it’s all about the right balance. An in-depth market study to compare the price set by your competitors will help with finding the right dosage. 

Use data to grow your business

Data is important if you want to promote your video-on-demand content and make money from your VOD platform. Gathering a lot of data is one thing and using it wisely is another thing.

Relevant data give you important insights about your viewers, their behavior, preferences, spending habits, and more. By combining certain information like the device used by your users, the time, their locations, the content type, length of video consumption, etc. helps to establish a clear picture of your viewers and give you the key to reach them better. Once you know what they love to watch, their preferred time, what they consume, etc. you can provide the most effective and personalized viewing experience on your platform.

Technical VOD infrastructure

A technical VOD infrastructure solution enables VOD providers to seamlessly offer value-added service subscribers. A good infrastructure will support increased streaming capability and will be able to achieve a massive scale-out of capability and architecture. 

Here are some technical points to consider to launch your VOD website. 

Video Content management system (CMS)

CMS is a solution that allows you to upload your videos and manage them. A professional video on demand software offers an easy solution to manage your video content through a single dashboard.

Content delivery network(CDN)

CDNs are a network of servers around the globe that allow you to stream your video content in a better way with maximum security. With a good quality CDN, regardless of the location of your users, they will be able to stream your video in the best way possible. 

Robust video player

It offers the best environment for your users to watch your content. It also helps with adaptive streaming (To propose the option of video version based on your user’s connection) and choose the language versions. 

Payment system

Your VOD platform must accept payments in different currencies for all bank cards. It is important to set up a recurrent fee system for SVOD, manage refunds, and keep track of all transactions for your accounting. It is also important to securing your customer information on your platform. 

Maintenance and update

After launching your VOD platform, it is essential to constantly update it according to the latest browsers to make it accessible from any device at any time. You must also offer reliable customer support to your users in case of any issues. 


Starting another Netflix comes with a lot of challenges and difficulties but offers a lot of opportunities as well to grow your business. Finding success as an entrepreneur is no easy task, but you can definitely get there with the right business strategies.

What makes you a successful entrepreneur in the video-on-demand industry? Share your success mantras with us in the comment section below. 

I am a professional blogger, guest writer, Influencer & an eCommerce expert. Currently associated with ShopyGen as a content marketing strategist. I also report on the latest happenings and trends associated with the eCommerce industry.

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.