One of the stalwarts of the online entertainment industry shares his opinions on the winning mindset that will make your video-on-demand service irresistible to users.

The success of the BBC's iPlayer since its launch at the end of 2007 has finally made 'on-demand' a reality and brought it to the attention of the YouTube generation -- an audience that craves high-quality content provided on its own terms. The result has been a rush of interested parties, from traditional media companies, content owners, platform and network operators to brands and production companies all wanting a piece of the video-on-demand (VOD) pie.

However, many of these players may not fully understand the complete VOD proposition and will struggle to make a success of their offering. Although content forms the backbone of on-demand, the reality of meeting audience expectations is more complex because, for the first time, viewers can control what, how and when they consume this content. To tackle this challenge, I believe that companies and brands operating in the VOD space need to adopt the mindset of a retailer.

Retailers' methods of encouraging customers to spend money have become increasingly sophisticated since the 'pile it high, sell it cheap' mantra of the 1970s. Supermarkets in particular are adept at understanding how to influence buying behaviour. Wafting the smell of freshly-baked bread through the store and placing hard-to-resist sweets and chocolate by the checkout may be well-known tactics, but they work.

Window dressing
Although VOD is not a new concept, successful mass delivery of on-demand content is only just beginning. Therefore, there are not any hard and fast rules yet. To date, the focus has been on ensuring the technology delivers a seamless experience for the viewer. But commercial success will hinge on the ability to be a digital retailer, rather than just 'ship content'. Today VOD players must have an attractive 'shop' and adopt intelligent and personalised marketing strategies that reflect their understanding of their customers.

First people must be encouraged to browse by an enticing shop front. Common sense rules apply here. Viewers will be put off by a cluttered home page. Content therefore needs to be clearly displayed, with a key element being easily visible distinctions between each version of the product and how much it costs (for example, are shoppers being offered items to download, stream, buy, view for 30 days, etc?). It must also be attractively packaged. 

Where is...?
Once in the shop, additional items must be easy to find. In these relatively early days of VOD, there is a temptation to deliver content in the form of endless lists that consumers need to scroll through to find what they want. However, shops don't line up products in alphabetical order as it is neither attractive to nor practical for the shopper, so neither should VOD operators.

But the sophisticated positioning of items in retail outlets goes much further. How often have you bought both crisps and dips in the supermarket because they were conveniently placed next to each other? Or decided on an impulse barbeque because the sun is shining and everything you need (and don't need) is in the same spot at Tesco?

VOD players must apply the same rules, up-selling and cross-selling by placing complementary content in bundles. 

Leading consumers to content
Another tactic is to adopt the equivalent of altering the layout of the store. This forces shoppers to change their set route and exposes them to items of which they may not have been previously aware.

In the online world, companies such as Amazon.com show buyers of a particular product what other people purchasing that item have also bought. This effectively leads shoppers to goods that they hadn't necessarily considered and is another tried and tested strategy for the VOD retailer to adopt. In addition, viewing more than one piece of content at a time should be encouraged, for example by flagging up the latest edition of 'Peep Show' when someone has finished watching 'The Mighty Boosh'.

VOD operators can also alter the shop front to account for the changes in viewing behaviour over the course of 24 hours. The online world uses this strategy to good effect, with the BBC for example updating its homepage four times a day to encourage people to look at different content. VOD offerings should reflect that initially people may be more likely to be catching up on TV programmes from the previous evening, but by night time they might want something lighter such as comedy.

Is the price right?
Supermarkets undertake constant price comparison programmes, both on a local and macro level, and adjust their own prices accordingly to ensure they remain competitive. This is another good rule for VOD operators, who should regularly check other players' offerings and price points.

Retailers are also smart at creative pricing based on the 'buy one get one free' model, which can take many formats. VOD content can be priced in a similar way, for example offering the first episode of 'Ashes to Ashes' free when the complete series of 'Life on Mars' has been purchased.

Customer insight
This may all appear complex and time-consuming to VOD players finding their feet in a fledgling market. But the principle is simple -- like any successful retailer, they need to make it an integral part of their job to know more about their customers than anyone else.

Phil Fearnley is founder & executive director, HUGE Entertainment.