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What’s Next for Mobile Adult Entertainment?
Posted On 16 Sep 2011
By Julia Dimambro
YNOT – One of things I love most about working in new media is that the playing field is constantly changing. There is never an opportunity to get complacent, because you are always having to learn something new and adjust your business accordingly in order to “stay in the game.”
Mobile entertainment tends to be at the epicentre of this concept with its mind-blowingly rapid and constantly changing landscape that affects day-to-day business. The launch of the iPhone is one of the best examples of this. Everything we knew, the way we worked, the way we structured deals and the entire value chain altered with the release of this single phone. Amazing!
On the flipside, for self-funded, smaller businesses (including much of the adult industry), this can be quite a challenge. How on earth do you know which areas of opportunity to focus on if you’re assessing uncharted territory? In many cases, it hasn’t been done before, so how do you identify in which areas to spend your valuable time, finances and resources? It can make your head spin.
So, having been 100-percent focused on one specific area of mobile entertainment for the past eight years, what do we at Cherry Media think are going to be the hot areas to watch in the next few years? Which are hype and which are genuine revenue opportunities for adult mobile entertainment?
Here are our conclusions.
Direct to consumer
The iPhone brought about a shift in the way people use their phones in their search for content and entertainment. Without a doubt, this has caused a global decline in on-portal content sales. The mobile network operator portals and decks are no longer the best way to reach customers, and this has resulted in a surge of off-portal, or D2C, services – especially for adult. Let’s face it: adult content and services never were popular with operators to start with.
Cherry has predicted the mobile web would become the main marketplace for many years. The question was, “When?” The answer is “Now!” However, in turn this has created a very crowded marketplace for adult services very quickly. Long-gone are the days where you could simply “build it and they [would] come.”
Based on the clients for whom we manage mobile strategies, the three crucial elements to a successful mobilization campaign are:
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3D
Will 3D develop into a new revenue stream for the adult industry, or will it just be a fad? From our experience so far, it will be the latter. If you have money to burn (which not many have these days), there is a marketing opportunity here, but you’re targeting early adopters who have invested in a 3D TV. You then need to consider that only a small number of these will be potential adult consumers — it’s a small percentage of a small percentage.
In addition, to get any kind of reasonable 3D effect, you really do need to shoot content specifically. Yes, there are services that will help you adapt your existing portfolio, but from what we have seen it very rarely works well, so what’s the point?
Even in the mainstream movie business with films that are ideal for 3D (e.g. animation, special effects), the first couple of times have a wow factor, but after that you notice it less and less during the movie viewing. Put simply, the novelty wears off very quickly.
In summary, you need a lot of money and resources for a limited market that has a limited shelf life. Early adopters quickly tire of the lack of difference 3D brings and focus on the next new thing as soon as it comes out.
Augmented reality
Here is an area that really DOES have the potential to change the landscape of adult entertainment. I’m totally sold on the huge scope of this technology and how you can leverage it for earning money with adult entertainment.
The underlying concept in all adult entertainment is fantasy. Our revenues come from immersing the customer in his fantasy. The better we do that, the more money he is likely to spend with us. Well, augmented reality, by its very nature, blurs the line between reality and fantasy by having both in the same experience. It’s ideal for the adult industry.
To give just one example of the unlimited possibilities of this technology, the user will no longer have to watch a lap dance on his computer or mobile screen and imagine the dancer is there with him. Instead, he will be able to select his favorite porn star and have her do the lap dance on his lap. Now that’s an immersive fantasy!
Live mobile video chat
This is already an established business model, of course, and has already made huge waves in mobile. With an average revenue per user (ARPU) of more than $50 per month, live mobile video chat blows away other digital adult entertainment figures. Top users on our platforms spend more than $100,000 a year.
The amazing ARPU and sticky factor that makes video chat so commercially successful are possible because many guys really do believe they are in some kind of relationship with the chat hosts; therefore, they initiate regular contact with them. Adding the “mobile — anytime, anywhere” factor only increases time and money spent when you have a single account for both mobile and web.
Based on our own figures and those from industry analysts, mobile video chat definitely is here to stay and will be one of the major revenue drivers for adult mobile entertainment moving forward.
Content trends
We are seeing two shifts in content trends:
1. Hardcore doesn’t cut it anymore. This is actually a little worrying in the context of society, but the truth is we are seeing many top-name producers focusing more and more on extreme and bizarre hardcore production.
Not long ago, simply showing a heterosexual couple copulating was considered totally “hardcore.” Nowadays, no basic fantasies or perversions cut the mustard from a commercial perspective, probably because there’s so much of it already about. “Something new” in the hardcore sense is “going extreme,” it’s not for the faint hearted.
2. Parodies: The rise of online tube sites (many illegal) and over-saturation of content distribution have resulted in many of the largest adult entertainment producers looking to corner a big-selling niche rather than continuing with “mainstream” porn categories and risk getting lost in the “noise.” One of the biggest niches appears to be parodies.
Obviously, parodies have been around for quite a while, but with major adult brands now focusing their production schedules on this type of content, it’s definitely going to be something we see as a growing trend in the future. Let’s face it: Porn never has been known for its movie plotlines, but comical and humorous porn is something that has a huge following. Parodies cash in on that audience.
Apps
Just a quick word on mobile apps, because there is so much information already out there. Our advice is “approach with caution.” You really need to think about your business and commercial objectives for creating an application. If you work with a good partner for apps, you almost certainly will get great download numbers for a free app, which makes free apps particularly effective marketing tools.
However, if your objective is to make money, tread carefully. This really is all hype right now. The market is struggling to monetize apps, and many elements still need to fall into place before this is possible for the average adult business. You can read more about Cherry’s views on monetizing applications here (PDF).
For more information and advice about any of the services above, or how Cherry Media can help you, please feel free to email us.
Julia Dimambro, founder and managing director of Barcelona-based Cherry Media, has spent the past 15 years in new media and digital communications with eight years specifically in mobile entertainment. After launching digital strategies and business divisions for companies including J. Walter Thompson, Deepend and Private Media Group, she set up Cherry Media in 2003 to enable brands and consumer-orientated aggregators to reach, acquire, engage and retain a receptive, high-spending and loyal client base. Cherry Media’s award-winning Cherrysauce operation is an industry leader in erotic mobile entertainment. Dimambro has been named one of the top 50 most influential executives in mobile entertainment four years running and one of the top 50 women in mobile three years in a row.
