Cost of errors
Calculate the cost impact of errors
Errors and any other interruptions are one of the major sources of frustration to viewers. The correlation between technical streaming issues and viewers abandoning playback has been well studied. In essence, there is a real cost to every error that a viewer experiences on your platform. The below models for AVOD and SVOD let you calculate how costly an error is.
AVOD1
In a research paper Krishnan and Sitaraman calculated that “a viewer who experienced failure is 2.32% less likely to revisit the same site within a week”. Based on this research we created the following calculator:
The cost of 1000 errors based on your inputs is
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SVOD2
Calculate the percentage the customer lifetime value increases by decreasing a particular technical error
Based on the inputs you provided, the lifetime value for the technical churn reason viewer segment can be prolonged by
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- Formula Cost per AVOD Error: [Plays per Unique] x [CPM] x [Ads per play] x [Recurring viewers] x [% less likely to return]
- Formula SVOD rate: ( [# of errors over LTV] – ( [# of errors over LTV] x (1 – [Target error decrease] ))) x [Errors per day] / [LTV]
Disclaimer
The Bitmovin Analytics Demo is provided on an ‘AS IS’
and ‘AS AVAILABLE’ basis, and to the fullest extent permitted by mandatory law, Bitmovin will
not be liable for any damages whatsoever, including and not limited to, loss of business or
profits or any direct, indirect or consequential loss arising from reliance and use of these
models where any action taken on such basis is strictly at the user’s own risk.
