The demand for online content is increasing everyday and this is true for all types of streaming services, whether it is video on demand or live radio broadcast. They all are experiencing massive demand. However, behind every successful streaming company is an efficient payment solution that allows them to collect payments from customers. For streaming platforms that offer pay-per-view and video-on-demand services, not having the right payment solution can result in lost revenue and frustrated users.
In this article, we are going to explore the top 5 challenges streaming media companies face and how they can overcome such situations.
High Failed Transaction Rates
Streaming media companies generally rely on subscription payments; however, problems such as expired cards, insufficient funds, or bank declines can result in a significant number of failed transactions. These can affect the subscription churn. To overcome these problems, streaming media companies can use my smart retry logic.
That means the payment gateway should automatically retry the transactions at optimal intervals, ensuring the customer is not overcharged. Many streaming media payment gateway companies offer a card updater service that automatically updates the new credit card information when the old one expires.
Along with these steps, merchants should also explore the possibility of accepting multiple payment methods, as this can help ensure uninterrupted payment collection. Alternative methods that can be used by streaming media companies include ACH, bank transfers, and wallet payments.
Global Payment Acceptance and Currency Barriers
Netflix is one of the world's most popular streaming media platforms, and there is hardly any nation in the world where it doesn't have viewers. This is only possible by accepting global transactions. If your streaming media company wishes to sell the subscription to the global audience in the US, Europe, and North America, then you must accept multi-currency payments.
For this, you must have a payment service provider that is fully compliant with local as well as international currency conversion regulations. By using an international payment gateway, streaming media companies can accept payments in international currencies and get the settlement in local currency. Many payment gateway companies also offer multi-language support to make international processing more user-friendly.
High Chargeback and Refund Rates
With any kind of streaming service, whether it is video streaming or radio streaming, chargebacks have always been a problem. Most of the streaming media companies operate on a recurring model and accept card-not-present transactions. Unfortunately, these can attract a significant amount of chargebacks, especially when users forget to cancel the subscription before the renewal.
There are multiple ways to reduce the risk of these instances. The first thing that streaming media merchants must do is use a clear billing descriptor. It is a good idea to use your company name or an abbreviation of your company name with the customer service phone number. Some merchants prefer to add the URL/website of the streaming platform.
Another step to reduce the risk of friendly chargeback is to send notification to customers a few days before the due date. You should also use chargeback prevention tools such as those powered by Ethoca and Verifi, along with that security filter, such as AVS and 3DS can also be highly beneficial.
Complex Revenue Models (Freemium, Pay-Per-View, Donations)
Streaming media companies offer a variety of packages; these can include freemium tiers, live PPV, or VOD. Payment for such a complex product range can sometimes be difficult if the processor is rigid. The solution to this problem is that you should use a flexible payment API.
Work with a payment service provider that offers a gateway, which can integrate with your platform easily and supports metered billing, one-time collection, and subscription payments.
It is important for you to know which content is working well, and that is why your payment processor must offer you a detailed reporting system. If your platform works on a revenue share model with the content creators, then your payment processor must offer the split payment facility so that the content creators get their share of profit automatically.
User Drop-off at Checkout
Streaming media is an impulse-driven industry, which means customers do not wish to take a lot of time to make the purchase. If the transaction takes a lot of time on your website, then the customer will visit another site and purchase the subscription. To avoid this challenge, you must have a one-click checkout option on your card as well as tokenization for recurring payments. Irrespective of what device the customer is using, your checkout page should be fully responsive. All the transactions should happen directly on your website, and the customer should not be redirected to any other page because redirecting that customer can result in cart abandonment.
Final Thoughts
In the end, we can say that a streaming media payment gateway is more than just a credit card acceptance system. It is a solid tool that helps you reduce churn, increase revenue, and efficiently support your business to grow globally. If you are running a streaming media platform and want to scale and grow to multiple countries by selling your services, then you must partner with the right provider who understands the unique demands of the digital media business.
Sign in to leave a comment.