Standing out in a crowded VOD market was a challenge for newly-launched platform Neon. Combining the best of the new platform with that of Lightbox, Sky has managed to crack the market.
Big streamers
The challenge
When Sky Television bought Lightbox in February 2020 it used customer data and extensive customer research to shape a new product. A full customer experience/UX and engagement overhaul resulted, combining the best of Lightbox and Neon. Putting massive pressure on the solution was an increasingly competitive environment, with recent international entrants such as Apple TV and Disney+ joining market leader Netflix, and strong free local offerings such as TVNZ On Demand.
The stakes were high – with pressure on Sky subscription numbers, and the stock market watching, great things were expected of the ‘merger’. And there was a short timeframe to make it work.
Sky conducted research with Yabble and TRA to better understand what mattered to prospective customers, and especially, to users of both the Neon and Lightbox platforms. What the broadcaster discovered shaped its plan, which was wholly based on insight. Lightbox was seen as having great TV series, local content, was a good platform to use, and was free. Users were less keen on having to pay extra for movies, a lack of content depth, and because it was free, it simply wasn’t taken so seriously and lacked consumer love.
Neon was rated for it’s (free) premium movie selection, quality of content backed by Sky and HBO, and the curation of content. Less popular was the platform experience, streaming quality, and lack of functionality (e.g. couldn’t download to watch later, interconnectivity with other platforms, devices and smart TVs). Perhaps critical, Neon was seen as more modern, international and had the potential to be more ‘quirky’.
The response
This insight defined a new plan. Sky used the Neon name, but the Lightbox platform.
The launch in July 2020, just five months after purchase, leveraged the superior technology of the Lightbox platform and related assets and combined the catalogues of both into a much stronger market competitor, and challenger brand to. Sky refreshed the Neon brand to give it more attitude, and created a multi-step micro targeted direct marketing campaign for subscribers to both services. Thus migrating both to the new platform and in particular transitioning a significant amount of Lightbox customers to paying for the service for the first time, as most Lightbox subscribers got it free previously as Spark customers. The campaign was focused around celebrating the new, richer content offering of Neon.
The result
Sky reported a boost in all streaming users by 80 percent at the end of 2020, converted a third of its large Lightbox free base to paying, and in the process more than doubling Neon’s existing base, and simplified the competitive environment.
Sky also shifted its NPS, which increased 10 points from August 2020 to January 2021 in Voice of Customer tracking.
Category: Utilities/Communications
Company: Sky Television
Marketing Initiative: Neon & Lightbox – Get it On!
Marketing Partners: Quantum Jump, OMD, DDB, HeyYou
Judges’ Comments: “The entrant skillfully executed a challenging merger of two contrasting customer-facing brands, cultures and tech platforms in a highly competitive and disrupted market, creating a successful new product, stronger than the sum of the parts. Amazing success story for a local offering facing global competition. Impressive commercial outcomes with sizeable transition of a previous non-paying audience into a revenue generating customer base.”
Finalists: Trustpower, Powershop, 2degrees, Skinny
This article was first published in the 2021 December/January issue of NZ Marketing magazine. You can subscribe to the magazine, here. Or read the other winner stories, here.
