What is the Product Channel Fit framework?
“Products are built to fit with channels. Channels do not mold to products.” – Brian Balfour
“The streaming wars” are not wars. Instead, they are about the optimal channels where streaming services can reach their target audiences. Netflix has a “moat” and a market paradigm with “ubiquitous access”: the ability to drive audiences both on-platform (personalized interfaces) and off-platform (advanced marketing, deals with cable and smart tv providers).
A streaming app secures distribution via Amazon, Apple, and Roku Channels in exchange for a share of its subscription revenue. The app is comfortable with the other costs of the Channels distribution model (high churn, a relationship with the customer controlled by a more powerful third party) in order to achieve product channel fit.
How does the Product Channel Fit framework work?
Generally, the distribution of OTT streaming apps is across software channels and/or hardware device channels. Understanding which channels a streaming app prioritizes and why can help us to better understand the total addressable market it is targeting. It also helps to identify the obstacles services face when reaching their target audiences.
Real World Example
AMC Networks CEO Josh Sapan “makes an interesting analogy of Netflix, Disney+ and other larger streamers as ‘department stores’. AMC’s portfolio of niche streaming services as ‘specialty boutiques that, if you were a fan of something, you would find your way to.’
Read these free pieces in order to learn more:
- A Short Essay on “Genre Wars” & AMC’s “Boutique” Streaming Plan (April 5, 2021)