Business Model

Bravo Media LLC. functions as a cable television network that creates programming content that concentrates on the arts, pop culture, beauty, fashion, and food. Bravo is a subsidiary of NBCUniversal-Comcast that is delivered via multichannel video programming distributors and digital distributors.  Their revenue comes from cable subscription fees, the sale of television advertising space, the sale of advertising on their digital media platforms, and lastly from licensing their own original programming (Comcast, 2012). These revenue streams have allowed Bravo to be a lucrative and thriving television network that has cracked Trendrr’s top 20 Cable Network list by holding the ninth spot (Trendrr, 2013).

Core Competency & Customer Base

Bravo separates itself from the clutter by creating original programming content that is driven by its larger than life personalities who are able to reinvent themselves and attract “passion groups”. These “passion groups” are distinct in nature and are an advertisers ideal target in terms of marketing their products (NBCUniversal, 2013). The Bravo viewer is the young , affluent, upscale, educated and ifluential consumer who is “in the know” and who is hooked up to all of the new emerging technology and media platforms (Myers, 2012). This presents a unique opportunity for advertisers, by providing a target group that can essentially work for them. Bravo’s core competency is their customer base and programming. Their consumers are innovators and people who are “influential in recommending to others”. They proved this in a 2008 campaign where Bravo first coined the term ‘affluencer.’ This campaign resulted in Bravo finally putting a face on their consumer and separating their viewership from the rest (ARF Ogilvy Awards-Warc, 2009). Bravo is ranked seventh by Nielsen for delivering affluent viewers ages 25-54 and the network is almost higher than every news and sports network in terms of affluent concentration (Affluencers, 2012). Additionally Bravo viewers are heavy consumers across many product categories including household items, food & beverages, and last but not least beauty products. To go into further detail, Bravo specifically targets four main groups, adults 18-49, Women 18-49 and the smaller categories of adults 25-54 and women 25-54 (Afflencers, 2012). Lastly Bravo prides itself on the fact that they deliver “passionate viewers who are truly educated, affluent, influential and engaged”. Bravo consumers are:

I.     41% more likely to share their opinions by posting reviews and ratings online.

II.     14% more likely to pay more for high-quality items

III.     14% more likely to aspire to be the top of their profession

IV.     24% more likely to perfer products that offer the latest technology

V.     16% more likely to give their friends advice regarding purchase decisions

VI.     23% more likely to have visited a social networking site in the past 30 days (Affluencers, 2012)

With that said, Bravo’s claim in regards to delivering affluential viewers is supported by Nielsen analytics that highlight their core competency.

Market Share

NBCUniversal is Bravo’s parent company and currently maintains 12.6% of the market share in the television industry. With that said, they are currently fourth in terms of overall market share. The other major players are The Walt Disney Compnay, Viacom Inc., Time Warner Inc., News Corporation, and Discovery Communications (IBIS, 2012).

Competition

Bravo thrives in an industry that is rooted in competition. The television industry is constantly changing therefore companies are forced to reinvent themselves to keep up with the changes that occur with time. The industry is always growing and with growth, comes an increase in competition. To go into further detail, there are four key areas to focus on in terms of competition for Bravo. They are, but not limited too:

I.     Viewers’ Attention and Audience Share

In the realm of television lie hundreds of channels and thousands of hours of programming. There is a surplus of content for consumers to watch and enjoy. Viewers can pull their content from broadcast networks, cable channels, premium channels, video on-demand and from many other platforms. With that said the competition is fierce in terms of building and maintaining an audience. Bravo is competing against its sister channels E!, Oxygen, and the Style network for viewership. Additionally, Bravo competes against outside competitors such as VH1, WEtv, and MTV. All of these channels maintain similar lifestyle and pop culture elements that Bravo programming has and must work to make distinct (Comcast,2012).

II.     Acquisition of Programming and Talent

Bravo must also compete for talent and the acquisition of programming. Bravo broadcasts a plethora of programs so that their viewers may have options. They frequently televise ‘Sex and the City’, movies like ‘How to Lose a Guy in 10 days’, and other programs not owned by them. With that said, Bravo has to compete in order to obtain and hold on to the rights of outside programming. Other networks that hold a similar model as Bravo are also competing for those same acquisitions to enhance their brand.

Additionally Bravo must compete for talent. For example, Bravo had a talk show starring Kathy Griffin, who is a nationally known comedian. With that said Bravo had to present a competitive advantage to secure her as talent. Overall, acquisition of talent and programming is a constant battle that Bravo must fight in order to remain a playmaker in the industry (Comcast, 2012).

III.     Distribution

In this day and age Bravo is competing with other cable channels for distribution by multichannel video providers. These service providers include cable TV systems, direct-broadcast satellite providers, wireline video providers as well as digital video providers such a Netflix. With that said Bravo must fight to have their network carried on all of these distribution outlets. Bravo must present why them and not somebody else in all of their distribution deals (Comcast, 2012).

IV.     Acquisition of Creative Elements and Personnel

Lastly, Bravo as a cable channel must compete for the acquisition of creative elements. This includes story properties, creative, performing, and technical personnel, and content owned by distributors. These creative elements lead to the development of programming and the personnel are those who make the idea come to life. With that said, Bravo must compete to acquire the best within these two categories (Comcast, 2012).

Strategic Relationships

Bravo has an effective strategic partnership with Foursquare. Foursquare is a social networking application that is location based. It aims to make users “make the best of where they are” by having a “check-in” feature. The app allows users to save the places they have been by checking in and collecting badges that represent those places; users then can share where they have been with their friends. Bravo and Foursquare’s partnership consist of 500-tagged Bravo locations that users can check in to. These check-in locations are tied to Bravo’s personalities who are in that specific area. With that said, when users check-in they are able to unlock to-do tips and suggestions from their favorite Bravo personalities, and given chances to win prizes. This partnership is extremely engaging and brings viewers closer to their favorite Bravo characters. Overall, Bravo delivers a mainstream, affluent audience to foursquare, while foursquare effectively promotes Bravo and engages their viewers (Van Grove, 2010).

What is Trending?

Social TV

Television is no longer a medium that consumers simply watch, it is something they interact and engage with via social platforms. It is not enough for viewers to only ingest programming content, they want their opinions heard and they want to hear what others are saying. So how do they go about doing this? Well, we are living with the hooked up generation, as Jack Myers would say (Myers, 2012). Consumers, specifically teens and young adults are plugged into a plethora of social media sites that allow them to do just what they want, to talk. These social media platforms allow consumers to interact with the content they are consuming and to be apart of a community of like-minded enthusiasts. With that said social TV is an undeniable trend that is supported by a surplus of data. Deloitte found that:

• 42% of Americans surf the web while watching TV
• 29% are talking on the phone while the TV is on
• 26% of American consumers are texting and/or sending IM’s while the TV is on (Drell, 2011)

So what does this data tell us? It tells us that people want to talk about it, they want to express their love or hate for what is being broadcasted on their television screen. They enjoy being social while watching TV, so much so that it is becoming second nature. A Mashable article reported that TV Guide has said that “Twitter leads Facebook when it comes to social engagement during a show’s airtime… 50% of users said they tweet about the show they’re currently watching only 35% say they post to facebook” (Drell, 2011). Users are doing all of this via their tablets, smartphones, computers and eReaders. Consumers are subconsciously staying connected to each other via these new and emerging innovations that are rapidly changing how the television industry interacts with their consumers. In the below graph it shows that a massive 42% of consumers are on their tablets daily while watching TV according to Nielsen (Orchard, 2013).

In 2012 Social TV took off to great heights. A TDG Research study found that Social TV has tripled within 18 months, going from 3.4 million monthly uniques to 11.4 million (PRweb, 2013).

This is a snapshot of how rapid this social TV trend is growing. To conclude, viewers have always had opinions about the programming they choose to watch, however now is the first time consumers have social platforms to share what exactly what they are thinking.

The Tablet

Tablets are a rising trend that is affecting the television industry in terms of how they connect to their viewer. Tablets have grown at exponential rates when compared to computers and smart phones. Tim Cook – CEO of Apple — illustrated this point when he said that,

“through the last quarter <Q1 2012>, I should say, which is just 2 years after we shipped the initial iPad, we’ve sold 67 million. And to put that in some context, it took us 24 years to sell that many Macs and 5 years for that many iPods and over 3 years for that many iPhones” – Tim Cook (Forbes, 2012) .

Tablets are at the forefront of hand-held technology and are only continuing to grow, therefore the television industry must adapt and incorporate consumers usage into their business models. Mintel conducted a detailed report on Tablets in 2012 and found critical information. The key takeaways for Bravo as a cable channel lie in two main categories:

I.     Ownership, Intent to Purchase, and Spend

1. Consumers 25-34 have the highest penetration in terms of Tablet ownership by maintaining 35% of the market
2. Households that earn $150,000 as an annual income have the highest penetration by maintaining 44% of the Tablet market
3. Asians show a higher level of Tablet ownership which is tied to higher household incomes
4. 46% of those surveyed intended on buying an ipad2 versus a Kindle Fire, Samsung Galaxy Tablet, or a Nook Tablet (Mintel, 2012)

II.     How Tablets are Being Used

1. 82% of tablet owners use them when they are home
2. 95% access the internet via there tablets when they are home compared to 59% when they are away from the house or work
3. 25% of tablet owners use them when they are away from home and work
4. 96% use there tablets to access media and 70% use them to surf the web (Mintel, 2012)

Apple leads the tablet market by holding 39.6% of the market share for the first quarter of 2013. Samsung rings in at #2 with 17.9% of the market, a 288.7% growth from last year.

 (Protalinski, 2013)

Companies like Samsung are making the tablet industry more competitive by providing quality, cost-efficient tablets for the everyday consumer. However, the key takeaway is that consumers are purchasing tablets more than ever and the television industry must adjust and implement new ways of incorporating this new technology and trend.

Cord Cutting

One of the most daunting trends that is taking place in the industry is cord cutting. Consumers are now eliminating their cable packages and substituting them with digital distributors such as Netflix, Hulu and Amazon. Currently,

“More than 90 percent of American households pay for TV, according to Nielsen. But by the end of the year, an estimated 4.7 million American households that previously paid for TV will have cut the cord, or about 4.7 percent of all subscribers, up from about 3.74 million in 2012, according to a recent report by the Convergence Consulting Group, a Toronto-based firm (Vikas, 2013).

This is a result of consumers gravitating more to customization rather than quantity. Consumers no longer want to pay astronomical prices for channels they never watch, so they would rather eliminate the hassle and handpick what they want via digital platforms. Cord cutting is an ever growing trend that will continue to affect the industry.

What Will These Trends Lead To?

Social TV

Bravo is a cable channel that prides itself on both their original programming and their affluent and educated viewers. Social TV works in a way that intertwines Bravo’s core competencies in a way that is beneficial to all parties. With the use of social media platforms, Bravo no longer needs to search high and low for consumer insights because they have a plethora of information right at the tip of their fingers. Advertisers are able to more effectively hone in on what consumers want and how they want to be marketed too by paying attention to social TV, and consumers are finally able to be heard. Each party is getting so much more than in previous years by simply being connected to one another as a result of technology. As time goes on, more things will continue to change as a result of Social TV, but there are three critical ways this trend may change the business climate:

1. Viewers maintaining MORE CONTROL

With social TV comes connectivity. Viewers are able to see not only the opinions of their friends, but thousands of other people. Social media platforms increase the power of word-of-mouth by making it so visible. Therefore, if a Bravo program is poor in quality and enough people feel the same way and tweet, tumble or Facebook about it, it could drastically affect the shelf life of that show. The fact is, people influence each other, so with social TV comes power and more control. In the near future, viewers could become the programmers of this industry by more VISIBLY steering what shows stay and what shows go.

1. A window for new CREATIVE ADVERTISING

Social TV is something that spans across many platforms, subsequently giving advertisers more room to be more creative. In the future, viewers may no longer see structured commercial breaks anymore, but rather integrated advertising campaigns that are imbedded in how they socialize through their various platforms. Social TV takes viewers back and forth from their TV set to their computer, phone or tablet. This insight tells advertisers that they have an opportunity to creatively tie what they are selling to how consumers watch their multiple screens. In 5 years, advertising as we know it may be spear-headed by eye-mapping technology that shows where a viewer is looking and thus dictating where ads will be shown.

1. Viewers expectation will being HIGHER

As previously stated, viewers now have the ability to voice their opinions and see the opinions of others more easily. With that said they are going to expect more and more. If they see some of their favorite publications tweeting about how bad the story lines of Bravo’s new shows are, Bravo viewers are going to expect quick changes to be made. With visibility comes higher responsibility to consistently satisfy loyal viewers. Expectations may rise to levels that are so high that networks may or may not be able to keep up. The key is for Bravo to keep their finger on the pulse of not only their target demographic but those who are coming into that age bracket.

Tablets

The serge in tablet purchases could drastically affect how Bravo interacts with their viewer. When looking at the statistics, it is a stark fact that Bravo must pay close attention to the usage of this technology. Viewers are using their tablets mostly in their house and do so while they are watching television. As consumers become more proficient in using tablets and as tablets become more advanced they are going to become second nature to viewers.

The future for these tablets is full integration into the cable box. In the future, viewers will have a tablet that knows what they are watching, who they want to talk to about the show (e.g. friends who watch the same show), and what information they want to know in terms of the program. The future of the tablet is full connectivity to all facets of what viewers want. No longer will viewers have to difficultly switch back and forth between twitter, their internet browser, Facebook, and the various applications. One day this information will all be readily available on the tablet, organized in tabs, and presented in an appealing way, all because the tablet finally got hooked up to the cable box.

What is Bravo doing with these trends?

Bravo is effectively tackling the social TV and tablet trend with Zeebox and their Play Live (via Bravo Now app) platform. Zeebox is a social TV application for iPhones, androids, iPads and Blackberry’s. It works by both providing a platform for viewers to easily access information about Bravo shows, while also allowing the viewer to know which friends are watching the same thing. In addition, Bravo has a participation platform called Play Live that viewers can use during live and pre-recorded shows. Play Live allows viewers to vote and answer questions during the broadcasts by using their Smartphone’s, laptops, and tablets (Hernandez, 2012). These votes and answers are tallied throughout the show for viewers to monitor during the broadcast. Additionally Bravo has tried to incorporate advertisers by allowing viewers to interact with ads as they do with their programming. Old Navy was the first advertiser used with this platform during the show It’s a ‘Brad, Brad World’ (Donovan, 2013). Overall Bravo is taking great steps in getting their young, affluent, and educated audience to engage and interact with their television screen. The challenge is to effectively market these new applications so that more of the Bravo audience know about it, download it, use it, and make it a consistent part of their viewing experience.

Cord Cutting

Cord cutting will lead to cable channels becoming more distinct and more innovative because they will have to, in order to stay relevant. Channels that have a smaller viewership such as the Golf Channel however, may be completely eliminated in the near future. If these smaller channels subscription fees take a sharp decline, then they may no longer have the financial means to stay afloat. Overall cord cutting could lead to reduce in quantity and the increase in quality. If smaller channels are eliminated as a result of cord cutting, then these huge media conglomerates will have more resources to allocate to their more successful channels.

Next Step: Innovate, Make it Easy & Be Aware

Right now Bravo is ahead of the curve. Bravo is developing new content by increasing their programming slate by 15% (Thielman, 2013), taking on new risks by creating scripted content, and incorporating industry trends with Zeebox and Play Live. Currently, Bravo is in a great position, the goal however is not to maintain but rather to grow. Bravo needs to continue to take risks in terms of programming, but make sure that it is content that the Bravo audience wants. They need to continue down this scripted programming path, while also making sure that these new shows align with the affluent, educated, and influential viewer they target. Lastly, but most importantly Bravo needs to primarily continue to innovate these new features they offer to their viewer.

Zeebox and Play Live have the potential of not only creating an engaging experience for their viewers but also setting a precedent of innovation in the cable TV realm. If Bravo can effectively hone in on the power of these two platforms, this could change how cable TV networks interact with their viewer. Twitter and Facebook would not be the simple go to apps anymore, but rather applications like Zeebox that make watching TV more of an experience.

Bravo can do this but it is a matter of two things, better marketing and making these applications easy. Viewers need to first know about these platforms. Yes they are in Bravo’s television and online advertisements, but are these marketing efforts really effective? The fact remains is that with iPads, iPhones, laptops and all of the other things viewers are using, traditional commercials are becoming more and more obsolete and ineffective.  Word-of-Mouth can be Bravo’s best friend. Bravo needs to create a large campaign that focuses on Zeebox and Play Live where viewers receive some unique gains from using these products. An example of this would be for each month a few viewers could be selected to receive a huge prize that is related to their favorite Bravo show. The catch is that they would have to use either the Zeebox or the Play Live platform to be entered into this pool. This will not only entice viewers but also stir up free word-of-mouth advertising. The takeaway is that Bravo needs to creatively innovate how they market these new platforms.

Secondly, Bravo needs to make their application easier. Bravo not only needs to make it convenient to find the Play Live feature on the Bravo Now app but also make the information on how to use it more easily available. It is not clearly displayed on the Bravo app and this will deter viewers from using the platform. In contrast, Zeebox, which is not specifically for Bravo, takes the user through steps in order to help them get acclimated to the application. Bravo needs to mimic this application that the Bravo viewer also uses, and apply it to their personal branded Bravo Now application. By doing this it will make users want to use this platform and engage with the content that is being broadcasted. Additionally Bravo also needs to clarify what separates Zeebox from Play Live. Do they each do different things, and if so Bravo needs to better illustrate this via their advertising. To conclude Bravo has to strategically market their innovative features more effectively and they need to make it all easy. By doing this, usage will improve and viewers will increasingly become more comfortable with interacting with Bravo television content.

Lastly Bravo needs to be aware of this cord-cutting trend and simply keep producing great content. Bravo is a successful cable channel that may take a hit if cord cutting takes off, however they have a strong enough viewership to still be a thriving network. Bravo should just keep their eyes and ears open when looking at this consumer trend.

To Wrap It Up

Bravo is a network that thrives off of who their viewer is and what type of programming they produce. Their viewer is an advertisers dream because they are educated, affluent, influential and their programming is a viewer’s weakness because their shows are simply addicting. After Housewives came Preacher’s Wives, Basketball wives, and Army wives. Bravo sets trends and Bravo captures trendy audiences. With that said, the network must keep up with what they have already established by constantly reinventing themselves.

Social TV and the increase in tablet purchases are two trends that Bravo can use to their benefit if they capture the opportunity right now. Social TV will result in giving viewers more control while also providing unique opportunities for advertisers to exploit new, risky, creative ideas. The serge in tablets will force cable channels like Bravo to better integrate their programming into this new platform that is becoming more and more apart of a viewers TV experience.

Lastly, Bravo has already taken the first step by incorporating tablet and social TV usage with the Zeebox and their Play Live platform, however they have not done enough. They must innovate their marketing for these new applications and they must innovate and expand their Bravo Now interface. Bravo needs to make their features well known an easy to use. This will then allow Bravo to continue to be ahead of the curve by efficiently engaging their viewers and creating a distinctive viewing experience.

Work Citations