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Based on the market assessment and consumer analysis, there are strong indications that
(exclusive) content can be used as a competitive advantage to build a leadership position in the
media market and maintain a growing customer base. In view of their business models and
increased demand, streaming platforms are able to offer a large variety of (partially exclusive)
content at any time, which is attracting consumers. However, the creation of exclusive content is associated with high costs, making certain investments inevitable to establish market
leadership. Therefore, goetzpartners has investigated the efficiency of content spending in relation
to audience growth in order to test the aforementioned hypothesis.
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In order to conduct this analysis, goetzpartners is introducing the Content Efficiency Index. It
measures the year-on-year (YoY) growth in content spending in relation to the YoY audience growth for selected players in the market. The index reveals whether a media channel is outperforming the market in terms of content efficiency – i.e., the percentage of audience growth in relation to the growth in content spending is higher than that of its competitors, thus showing an above-average content efficiency – or whether the growth in content spending is not leading to a
level of audience growth that justifies the expenditures (below-average content efficiency).