TVN Executive Session | CW Steers Viewers From Streaming To Broadcast
Many broadcasters have been conflicted about their relationships with outside streaming services, but The CW doesn’t have any such baggage.
The ViacomCBS/AT&T-owned joint venture staked out early relationships with Netflix and Hulu, using the two platforms to cultivate what they do best: creating binge watching viewers who thrive on the kind of serialized programming that are The CW’s stock in trade. Hungry new viewers were minted in streaming, then the network used an arsenal of data and social media messaging to coax them back to its owned and operated platforms on both linear and digital.
Mark Pedowitz, chairman and CEO, and Rick Haskins, president, streaming and chief branding officer, are the two architects of The CW’s streaming-to-linear strategy. In an interview with TVNewsCheck Editor Michael Depp, they explain how they’ve adopted streaming as an essential tool to grow their audience, how social media plays a key role in the migration and how a multiplatform strategy can give shows that are slow out of the gate a vital second wind.
An edited transcript.
It seems the folks at Viacom, CBS and AT&T are happy with the strategy you have been employing to grow your audience, Mark, so let’s start there. What changed in terms of your audience size and demographics since you came to The CW nine years ago?
Pedowitz: The demographics nine years ago were 70% female, 30% percent male. Now we are much more balanced because of the addition of superhero shows across the board. Today our demographics are 53% female and 47% male.
This is an app-based world. We had to embrace the fact that the younger audience was going to go and watch where they wanted to watch and it was not necessarily linear. We have been way ahead of that curve in doing that, and the utilization of both the cwtv.com app as well as using our linear service and then coupling it with CW Seed, our digital-only studio, which features original content and popular library series.
Let’s drill into exactly how you use streaming as a tool to grow your audience. You weren’t getting the traction on air you were hoping for and then Netflix came into the picture. How did it go from there?
Pedowitz: As I came into the company, serialized programming was not a great boon for traditional marketplaces, but serialized programming might work with respect to streaming because of its bingeability.
Before I got here, we had terrific serialized programming — Gossip Girl, Vampire Diaries, Supernatural. So when the original Netflix deal was struck in 2011, it was a turning point as the fans of our shows were given the ability to binge past seasons if they missed them initially on The CW.
That allowed us to get our programming out to new viewers on a different platform, and at the same time, reach them with messaging that if they didn’t watch it in its first run on The CW, catch up here (on Netflix) and come back to The CW, where we have new episodes exclusively in the next season.
While Netflix was for out-of-season streaming, we also had an in-season streaming deal with Hulu back in 2011 to stream the five most recent episodes we aired, which mirrored our own streaming platforms. After a few years, it was unclear if we would continue this in-season deal with Hulu for our programming, and it was during that time that we began to formulate CW Seed.
The development of CW Seed and deploying it into the marketplace allowed us to test technology, do research and understand the other platforms, devices and OTT services that we need to be on. That way, if the Hulu deal expired, as it did in 2016, we would have the exclusive in-season rights to our programming and allow us to turnkey our app across platforms thanks to everything we had learned from the creation of CW Seed.
Haskins: That really was the opening where we could be on the OTT platform and be everywhere our audience was. Our defining strategy is to give this consumer the product they want, where they want it, how they want it. That allowed us to be on the OTTs, which were growing exponentially.
By doing that, we were able to reach more of our audience and really start seeing the shift from linear to digital with some of the audience we have lost the past. We have a unique ecosystem between linear, digital and our social media platforms. Through that, we are actually able to cycle people through social to linear to digital and back again. Those are the three elements that have helped us not only build our audience, but move them into other programming.
Can you elaborate on the social media role there? How exactly do you manage that in a way that might be atypical for a broadcaster?
Haskins: We didn’t have the advantage of a lot of money for media that a lot of our competitors did. We needed to be smart and savvy. We hooked up very quickly with Facebook and became one of the very first advertisers, if not the first network, on Facebook. We grew up learning about social the same time that Facebook learned about what it meant to expand.
Shortly after that, we went into Instagram and after that we went into Twitter. That has always been part and parcel of our DNA and we have always used that as a means of communicating to our fan base. At one time, we had over 125 million followers. It’s down from that as shows come in and out. But the important thing that has not changed is we have about 80% engagement.
How long of a runway did The CW shows need on Netflix before you began to see audiences coming back to your linear network for new episodes?
Pedowitz: In the early days, the shows were not branded initially CW on Netflix, so Netflix got a terrific advantage. Rick and his marketing team had to go make a marketing plan to make sure that the new episodes would be exclusively on the CW the following season.
We saw pretty quick results back on Supernatural, which helped to revitalize and resurrect it, as well as The Vampire Diaries, which went through the roof. We then saw it again for Arrow, Flash, Jane the Virgin, Riverdale, All American and In The Dark.
Haskins: The challenge from a marketing perspective is how do you break the perception that something is a Netflix show and then move them over to The CW? People who are used to seeing it on one platform don’t necessarily want to look on the other platform. The key for us is emphasizing “new.” For example, we tell them the only place they can see new episodes of All American is on The CW, and our hope is that proves enough advantage to move fans from Netflix to check out the new season on The CW.
As you note, viewers don’t always have a clear take on where their network-originated programming is coming from when they encounter it on Netflix, Hulu or Amazon. Can you drill further into how you found that marketing strategy to call them back to the CW?
Haskins: In many ways, Netflix does that on purpose. That is their business model. My business model is to help the viewers understand that it was an original CW show. We do that by clear, concise consistent messaging that if you want to see [our] show, it is only on CW.
Where is that messaging happening? On social? On your linear network?
Haskins: We rely heavily on data to help determine the best place for our messaging. We drill very deeply into very microscopic points so we know how to reach people who have seen our show on Netflix, and target them with an ad message reminding them that the show they started to watch on Netflix is now on The CW. And we are able to reach them through our own platforms and through outside media.
Can you walk through this a bit more specifically on a show like All American? That was a show that based on its on-air performance didn’t seem to have much of a future. Then comes Netflix, a new audience, a second act. What exactly happened?
Haskins: We knew that we had the right show, but we didn’t have the right audience. The right show is always the hardest thing to do, but then going out and finding the audience is the next hardest thing. Knowing we had the quality show, we needed to figure out a way to get that audience who accepted it on Netflix to accept it on CW.
That’s where the marketing came in through Simulmedia, Google and different advertising partners to get that message out to that precise audience. We don’t overspend, but we spend very economically knowing that a message is hitting someone who has seen that show on Netflix.
The CW’s owners have begun calling back programs on Netflix for their own nascent streaming services on an out-of-season basis. How is that going to impact your strategy going forward given that neither of those two platforms have anywhere near Netflix’s subscriber base?
Pedowitz: That’s why — with the Netflix deal ending last year — it became imperative for us to have in-season rights to stack all of our new shows going forward exclusively on our own streaming platform throughout the broadcast year. This allows us to tell viewers they can watch all of the episodes of those new shows on The CW app or cwtv.com the day after they air. All of our marketing reminds fans that if they haven’t seen a new episode, its available to stream now, or they can come and binge from the beginning of the season.
Haskins: We are in a transition period right now. Bear in mind, only a few of the shows on our schedule this season (4 of the 18 scripted series) will available as a full stack on our streaming platform. Any of the older shows under the former Netflix deal would still go to Netflix out-of-season. So we have to approach promoting the streaming of those new shows — both in-season and when we have a full stack available — differently than if we had Netflix to help us.
In the long run, as more and more of our programming is available as a full stack on our streaming platforms, we will begin to handle our streaming the way Netflix has in the past and keep the promotion and circulation within our own platforms.
Can you give an idea of your audience size on your owned-and-operated digital platforms relative to your Netflix audience?
Haskins: We have about 70 million app downloads, which is growing at about 12 million a year.
What is the average engagement time on your own app?
Haskins: About 70% of the audience will watch an episode to completion once they engage with the show. Some shows see an 80%-85% completion rate once the viewer is engaged, some shows will be about 60%. Nothing is below 60% after engagement.
We seem to be hitting a plateau of streaming services in the marketplace. What does that proliferation of new streamers signal for the future of new and existing AVOD streaming services like your own?
Pedowitz: We have always viewed our AVOD service as complementary to any SVOD model out there. We have never felt that we were competitive to that. It’s free; you just have to watch ads.
Haskins: There are two magic words in marketing: one of them is new and one is free. With an AVOD service, the millennial audience and Gen Z understand that the price they are paying is to watch advertising for free quality programming.
Have you ever considered launching any of your new shows on a streaming service first and then migrating them to your linear broadcast? Would that be a logical next step for The CW?
Pedowitz: We have thought about it for promotional [purposes] only. We felt that would do a disservice to our broadcast partners.
Haskins: Something that we have done is created shows that started out as digital. Two Sentence Horror Stories is an example that did well on digital and then we moved it to broadcast. It started as digital only, but we felt that the linear audience would appreciate it. We did it with Mystery Decoded as well.
Another example is to complement our DC product that we have on linear, we have done DC animated projects on CW Seed only. Our latest one, Deathstroke, has done better than any of the others and it has moved people back to Arrow. So regardless of where a show ultimately airs — linear or digital only — we continue to push the audience to linear, with programming that is complementary and completely on brand.
You have super heroes, comic book characters, Nancy Drew. What is the common successful denominator in programming?
Pedowitz: It’s about characters. It’s about relatability. For us it’s where fantasy meets soap or serialized dramas. We are not a procedural network.
Do you have plans to focus development in any new areas? Is the Arrowverse extended to the max?
Pedowitz: We look at it case by case. I think the Arrowverse is a remarkable story with the studio and our teams working together to create something that’s never really been created on TV before. My hope is that the Arrowverse far outlasts my tenure at the network because that is a tremendous legacy. We have created a place where comic book characters can do what they do best in comic books, cross over and go back and forth to each other.
Nexstar is now the largest CW affiliate group, and Perry Sook has mused to TVNewsCheck that perhaps Nexstar itself should be a part owner of the network. Is that a viable possibility or do you see Nexstar having a bigger role in CW’s fate?
Pedowitz: I think Perry should have a conversation with the owners of The CW. It’s nothing I can comment on.
What about a national newscast? You haven’t had one. Are there any prospects of The CW getting into the news space?
Pedowitz: That is not the model we have. We are strictly an entertainment network. At the moment there is no business model for us to get into the news space whatsoever.
On the fiscal side, do you have a plan to get the CW out of its operating losses? How might that happen?
Pedowitz: The CW is remarkably successful within the ecosystem provided by the joint venture owners. I would say P & L is not that relevant here.