As HBO Max Turns 1, the Streamer Mines Its Early Data For Year 2 Growth

“We look at about 250-plus separate signals as consumers are on their journey with us, and what we’re trying to do when we see those signals is project out engagement and also influence it in a better fashion,” says Brad Wilson, WarnerMedia evp, growth and revenue. “We’ve got the foundational bedrock of great storytelling, but we have to respond to all of the signals that our customers are giving us to make sure that we’re putting forth the best experience.”

Those signals include: What’s the diversity of programming users are watching? How deep into a genre or series are they going? Did they watch two consecutive shows on the same day? How many hours do they spend on the service, and how frequently are they watching content? And are they watching on bigger viewing devices like connected TVs, or through their mobile phones? Is there a kid’s profile set up on the account, and how often is it being used? Are users watching movies or series more often?

The answers to those questions don’t just inform HBO Max’s programming and curation choices—they’ll be key to HBO Max’s ad-supported tier rollout in early June and to the service’s international expansion (it will be available in 39 territories in Latin America and the Caribbean beginning June 29), both of which will look to build on the lessons learned from the streamer’s first year on the market.

HBO Max and HBO ended March with a combined 44.2 million subscribers in the U.S. and 63.9 million worldwide subscribers, and the company is aiming to scale even faster with the lower-priced tier and the global expansion, even as its future form remains uncertain following the recently-announced blockbuster merger between WarnerMedia and Discovery. (Wilson, like other WarnerMedia execs, says it’s too early to say how those companies will be combined.)

What WarnerMedia-Discovery’s Streaming-Centric Merger Means For HBO Max and Discovery+

Originals—and kids shows—open the door

The truism that content is king holds, and on HBO Max, those kings are original series and films. That stands to impact HBO Max With Ads’ marketing messaging, which will lean into the most-buzzed-about originals available on the service when it rolls out this summer, since those titles are what consumers normally come for first.

“What we’ve learned is that originals matter, there’s no doubt about it,” said Wilson, whose team manages all of the service’s growth marketing, acquisition and retention efforts. “We’ll blend a bit of single-title messaging to these audiences, as well as multi-title messaging. We’ve found that when we’ve packaged multiples, in a sequential programming slate or when they’re going to debut, it’s highly, highly effective.”

Also key to those originals’ success has been the industry-shaking move from WarnerMedia CEO Jason Kilar to send all of Warner Bros. 2021 theatrical slate to HBO Max the same day they premiere in theaters. Those day-and-date theatrical releases like Wonder Woman 1984 got viewers in the door, and then gravitated toward original series like Kaley Cuoco’s thriller The Flight Attendant. (HBO Max With Ads will not have day-and-date theatrical releases, but those titles will eventually make their way back to HBO Max.)

Those originals will anchor the rollout of HBO Max With Ads—especially the rollout of the buzzy Friends cast reunion, which debuts today, and which Wilson is betting will drive first-time sign-ups to the service.  

Kids-themed programming is also a driving force on the service. While children’s content has always been an important element of major all-purpose streaming services, the number of kids profiles created on HBO Max accounts surprised Wilson in the first year. As a result, the platform’s kids programming will be more heavily featured in year-two marketing to drive attention to the service.   

“We actually feel like there’s much more opportunity we can do there by leaning in more heavily with some of our messaging in the future,” said Wilson.

As HBO Max’s new content keeps rolling out, it is also expanding its marketing lens to highlight new originals for existing customers in order to keep them coming back to the service. That’s a recent adjustment to the streamer’s earlier marketing strategy, which was focused more on acquiring new subscribers than on retaining existing ones.

“In the early days, even probably as recent as October, November, we were not necessarily addressing in our paid marketing people who are [already] on the service,” Wilson said. “That has materially changed and shifted, and now we’re very mindful of cutting up our cohorts or segments and putting messaging that focuses on getting them to come back and watch the next thing.”

Curation drives engagement

While originals help get new customers in the door, deep library shows like Friends, The Big Bang Theory, The Fresh Prince of Bel-Air and South Park consistently rank among HBO’s Top 20 titles on the service, proving to be significant drivers of total time spent on the platform. Wilson and his team’s aim is to make sure customers can find those high-impact library titles right away.

To do that, Wilson and his team are focused on lessening the amount of time it takes for a user to find what they will watch next. Hand-curated content collections—including those themed around cultural moments like Black History Month and Asian American and Pacific Heritage Month, genre-specific collections like the classic films curated by Turner Classic Movies, or certain shows like Game of Thrones or Friends—all help with the discovery process.

“What we’ve learned, now that we’ve added personalization to 100% of users, is that it’s so much better for engagement and retention,” Wilson said. “When we layer those in for the majority of customers, that also adds to better engagement.”

The company was “fairly confident we would have much better engagement versus the product that was out prior to HBO Max,” Wilson says, nodding to HBO Now, the streaming service for HBO subscribers that was sunset last summer following the HBOMax debut. But the lift has been higher than anticipated. Engagement on HBO Max is up 70% compared to the engagement on HBO Now.

Time spent searching has also decreased since HBO Max’s first months on the market. Today, the average HBO Max user spends under 100 seconds browsing on the service.

“The less time it takes you to find something, the more you’ll actively watch, and your engagement hours will go up,” Wilson said.

Wilson credits those figures to the company’s approach to offering up those human-curated collections that are served up algorithmically.

“Every time a customer takes an action, we are constantly writing that to a customer record,” Wilson said. “We’re looking to actually make some inference based on who you are, which allows us to put forth a collection or a title back in front of you.”

There’s a balancing act of getting the perfect blend of art and science, but the company will continue leaning in.

“If we over-rotate on the science or personalization and just let algorithms do the work, it’s not going to be as effective as blending in some human touch or curation,” Wilson said.

HBO Max’s Ad-Supported Tier Will Debut in Early June at $9.99 a Month

HBO Max With Ads’ price is (hopefully) right

Throughout the first year, many HBO Max subscribers have stuck around, but some of them (WarnerMedia doesn’t disclose how many) churned off the service. That means the ad-supported tier will give HBO Max a chance to win back over customers who previously said sayonara.

“Let’s face it, we live in a world of subscriptions and therefore we’ve had some people leave our service,” Wilson said. “For people who have suggested that price was the core issue in which they churned out of our service, we can go back and re-introduce a new plan for $5 less than what we’ve offered before.”

It’s also another chance to go out to market and win over first-time customers who are more sensitive to price. A heavy emphasis out of the gate in HBO Max’s year-two marketing plans will include price-point messaging, mentioning that plans start at $9.99 a month.

“We do believe we can expand the market here, particularly for people who are unaware that you can get HBO Max at a lower price,” he said.

As Wilson digs into the data, his North Star remains on supporting the service’s continued brand growth while supporting the scaling-up required to win in an ultra-competitive environment. And that work is never complete.

“Most digital or direct businesses win through brand, speed and personalization at scale,” he said. “Fundamentally, HBO was a crown jewel of a brand, and we need to make HBO Max a crown jewel of a brand.”