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How to Reach Multicultural Audiences in the Stream-First Era
00:22:55
Next in Media spoke with Fuse Media's chief business officer Patrick Courtney about what advertisers get wrong about multicultural audiences media habits, the challenges in programming in the FAST space, and why cable TV still makes sense for some media companies.
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- [00:00]
Epsilon Representative
In the marketing world, walled gardens are one of the biggest obstacles to knowing your customers. That's why Epsilon built the industry's most accurate, stable and scalable identity solution. With Epsilon Core id, you'll recognize and reach your customers in a privacy safe way and achieve unrivaled accuracy and reach. Learn more@epsilon.com CoreID that's epsilon.com C O R E ID this week on Next in Media, I spoke with Patrick Courtney. He's the Chief Business Officer at Fuse Media. Fuse is one of those companies you might think might be struggling amidst the basic cable meltdown. But as Patrick and I talked about, the Multicultural Inc. Company has rolled out seven different fast channels over the past few years, along with the subscription streaming app. It's a great example of the delicate and challenging balancing app companies with a traditional media background must face in this era. Patrick has a super interesting perspective on the market.
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Mike Shields
So let's get started. Hi everyone. Welcome to Next to Media. I'm Mike Shields. I'm here with Patrick Courtney. He's the Chief Business Officer of Fuse Media. Hey, Patrick, thanks for being here.
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Patrick Courtney
Hi, Mike. How are you?
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Mike Shields
I'm all right. I'm pumped to talk to you because you're in an interesting spot right now and I don't, I know enough about the company to be dangerous, but I feel like it's been around for a while and I wonder if some of my listeners are in the same boat. So just catch us up on like what Fuse Media is what you do there. We'll get into what's, what's going on in the business.
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Patrick Courtney
Yeah. Fuse Media has had many lives over the past 20 years. So yeah, what, what you might have known Fuse Media to be maybe different today. So I think it's good to go over it. Fuse, we're the global leader of inclusive entertainment. So we're a diverse owned company, we're Latino owned. We reach a multicultural audience across two traditional linear networks, seven owned and operated fast channels, a subscription service, and digital and social. As chief Business officer, my job is to kind of support the growth and the evolution of our business as it kind of navigates this rapidly changing environment.
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Mike Shields
That's a lot of stuff I want to get into a little bit. So who is your target? I think people might be surprised some of what you said there. Wait, cable, this audience, does that make sense? But then you're expanding into so many areas. So give us your target and maybe like talk about your programming and the landscape for this audience that we traditionally think of.
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Patrick Courtney
Yeah. So our audience definitely I mean, broadly speaking, it's a, it's a young multicultural audience in 18 to 34. And of course, you know, that differs by distribution medium. Right. So pay TV tends to be a little bit older. FAST is, you know, we're still figuring out exactly what the audience is for FAST as that's a growing and nascent environment and our Fuse plus audience being being a little bit different. But even within fast, we have channels like shades of Black, Latino vibes, Elray, Rebel Out TV Proud, our culture collective partners. We really are truly kind of a diverse representation of our content across all platforms, which is what makes us a little bit different as a diverse owned company. We aren't reaching one segment of any one particular community. We reach a broad multicultural audience that is a younger one.
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Mike Shields
It's probably hard to summarize that many different channels and outlets, but is there a thread between, if you compared yourself to the established multicultural media, particularly television, are you younger, more diverse? Is there a different programming angle that colors everything throughout or does it really depend?
- [03:24]
Patrick Courtney
It definitely depends. I think what works on say traditional linear versus what works on fast versus what works in subscription, it's different programming strategies. It's been a challenge for I think many media companies to have this yes and philosophy. Yes, we're in pay TV and we're in FAST and we're in subscription and we're across digital and social. And so our program is strategy has had to adapt to those environments. You know, how we program our pay to be linear network is definitely different than how we program our seven fast channels or our subscription service. And that's been, you know, it's been one of the key challenges that we're, we're still figuring it out. I think a lot of media companies are still figuring that out and then figuring out how do we design our organization around servicing all those different aspects. And so, you know, we've had to look at our programming and scheduling team and see how they can service pay TV as well as fast and our ad sales team could sell across all these different mediums. I mean it's been, I've been at the company for seven years and we, and we're still, we're still in the middle of understanding exactly where this is all going and how to continue to adapt to it.
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Mike Shields
Give us a couple examples of like stuff that's, I mean it's really early in some of this evolution. You talked about things that have worked maybe that were different than like for example, in your FAST strategy. A lot of, A lot of fast, you Know, generally speaking have been like let's put a bunch of old shows together that we own and put out a lineup and make make life pretty easy. How did you approach, you know, programming that versus what you were doing in television and how to maybe carve out a real brand there in such a crowded area?
- [04:56]
Patrick Courtney
Yeah, I mean FAST is increasingly crowded. I think there's a number of things going on on the technology side to kind of help create a better user experience. Things like personalization or machine learning to show you recommended channels that you may watch more and things. But we have always taken the position that strong multi content channel brands will have a really important place within FAST just as they have in traditional linear for you know, decades. What works is it's changed over the years. It started with, you know, a lot of just sort of stringing together whatever programming you had and throwing that up. And that's what we initially started with. Seven years ago we had a channel called Fuse xl. And it's just like whatever we had lying around was stringing it together, just seeing what was going on pretty quickly. Like right around, you know, at the pandemic when things really started to take off for free tv we started to know like, well, how we, how we schedule this, how we program this actually matters to how the audience shows up and how they watch. Yeah. So that's when we took the discipline that we had on programming and scheduling in our pay TV linear and started to apply those same techniques in the past and we've seen enormous growth. We have several case studies in which we've taken a channel and then applied what we do best on that and seen exponential growth simply because of how you day part things, how you know, how you schedule the programming. But I will say that like FAST still primarily is a place where people go to find things they already that are familiar. Right. It's to go to binge watch series or to watch studio titles that they've seen. And I don't think you know, anybody's quite cracked original like new programming when it comes to general entertainment in fast. And that's partly because the audience is showing up for a specific expectations are a little different. Yeah, yeah. And I think that there's definitely there's efforts that are being made on the platform so side on the programmer side to figure out okay, how do, how can you make, if you can, how do you make original programming work and how, what would that look like? But I still think that's like a work in progress on fast.
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Mike Shields
All right, let's take a Quick break. I'm here with Lee Lewis, he's the director of Platform Adoption at Epsilon. Hey Lee, thanks for being here.
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Lee Lewis
Thank you.
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Mike Shields
So I just want to ask you about this increased role of people based identity which is coming at a time when there's so much change in signal.
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Lee Lewis
Absolutely. Thanks for the question. Consumers are expecting a seamless experience across all channels, whether they're browsing and getting an ad, receiving an email with a product recommendation or receiving a postcard in the mail. The only way to do that is to create an identity solution that understands who the person is. In digital media, we use touchpoints like device IDs and cookies. Although we use them for recognition, they do not represent people. And so an identity solution can use those as touch points to recognize individuals. But ultimately it needs to be anchored in individuals.
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Mike Shields
Now how does AI help you there?
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Lee Lewis
Right. As consumers we generate tons of data, right? What you buy, what you view, you know, the types of content you like to consume online. There's so much data that's available to us and the way we use that is very critical. Right. Using signal from all of these different channels and consumption patterns helps us create potentially interesting experiences via these different channels that ultimately will lead to conversions.
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Mike Shields
All right, great stuff, Lee, thanks a lot.
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Lee Lewis
Thank you.
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Mike Shields
So this is a multi part question, I guess, probably hard to answer, but what's your biggest challenge with fast? I'm kind of fascinated by this, that is it discovery? Is it trying to figure out, well, the measurement isn't like, isn't traditional or it's you're playing in someone else's house, so to speak, where you don't have total control of the, the numbers, the distribution. What's your biggest challenge there? Maybe how have you guys worked around those things?
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Patrick Courtney
The challenges are many.
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Mike Shields
It's a good question. When you get a big sigh like that.
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Patrick Courtney
I feel, well, we love challenges here at fusp. Yeah, we're no stranger to tackling challenges. I think there are several. One and I think this has been talked about quite a bit is that there is a limited amount of information, data that's coming through as far as the content, the performance of the channels and what's working, who's watching, watching it, that kind of thing. And I think there's a lot of talk about how can we work better together so that we're able to start to measure these things and start to be a little bit more actionable on how we can all really achieve the potential that FAST has by programmers understanding their audiences and what's working there. So I think that's been an ongoing challenge. And when you're talking about all these different FAST platforms that you're distributing to and they all have their different priorities in the way that they want to do fast based on their ecosystems, it's a challenging environment.
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Mike Shields
You know, a bunch of different cable companies, but the MTV was the same in everyone. Like it's, it's the presentation and then all the delivery is really different. A lot of these guys.
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Patrick Courtney
Right, right, yeah. Like how they organize their EPGs and how they're thinking about FAST in relationship to other aspects of their services, their platforms and where they're pushing people to and things like that. Like, you have to have a lot of those different considerations, whether it's an opt in platform or just sort of like a native type of platform, because there's S and P standards and across these different things. So there's, there's a. Of like configurations in FAST across these different platforms. There's not a ton of standardization on that. And then not having the data. Also to be able to inform how we should be doing this, we, you know, we've had to do a lot of sort of like directional types of analyses and seeing how this stuff works and you know, it's going fine, but I think there's a lot more work to be done. And then I think on the other side is like the ad sales market is rapidly changing and that was going.
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Mike Shields
To be my next question.
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Patrick Courtney
Yeah, that, that's been a challenge. You know, we, we've been fortunate that we, we have. We've been selling traditional linear television for 20 years and we were very early and fast. We started in 2018 and we started, you know, organizing ourselves and evolving ourselves to be able to sell CTV right alongside our traditional linear. And that's where we've been successful up to this point. And we, where we, we've been historically oversold across all of our own and operated on CTV and we launched our culture collective, which we can talk about. But I think that now we're starting to look at. Okay, well, things are starting to move, starting to go more automated. There's a lot more programmatic. That's how CTV is being transacted. How do you adapt to these things when there's less of a need for brands and advertisers to commit budgets in an upfront and you're looking at a much more sort of like programmatic business. It's looking a little bit more like what like digital media has looked like. And then how do you play in that Space. Also when you've got all of these big walled gardens that are coming in and sucking out ad dollars from the market, you know, again, it's a, it's a challenge. But we've, we've seen like incredible growth on fast when it comes to our ad sales business. And we're still very excited about it. It's just not without its challenges.
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Mike Shields
I'm going to come back to the programmatic side of things. But I wonder, wonder for traditionally you said, you know, Fuse has had many lives and it's changed over time. One of the things you hear about in the multicultural space, the complaint of maybe getting stuck in a, in a bucket, like, oh well, the minority agency handles that or that's, that's only for certain budgets. You can't compete for everything. You know, given what's gone on over the past couple years, have you seen that evolve? Is it still a challenge you face?
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Patrick Courtney
I think it's, it's again, it's kind of like it's not really an and or it's just it like we're, we're looking at budgets from both areas.
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Mike Shields
Yeah.
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Patrick Courtney
Being a diverse owned media company, you know, we look at how do we capture budgets that are, you know, allocated for diverse owned media specifically. I mean, when you look at the demographic that we specialize in, our 8, about 18 to 34, I mean the majority is multicultural. Right. Like multicultural is a general market. And so I think we're starting to see an evolution on the buying side too, that's responding to that. And so we're, you know, we're continuing to figure out what is the best go to market strategy in order to present that. But we think that the audience that we reach, which is at scale across these different platforms, a young multicultural audience, is an audience that has tremendous buying power and is something that general advertisers are looking to reach right now.
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Mike Shields
Getting back to your talking about it like embracing of programmatic channels, whether you're using direct marketplaces or SSPs, you're putting your inventory out for everybody to buy. A lot of big media companies have sort of gone that direction, but kept it at arm's length or wanting to have a lot of control. It sounds like you've gone all the way. That sounds racy, but it sounds like you've been fearless when it comes to programmatic stuff. Can you maybe talk about if I have that right and why that might be?
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Patrick Courtney
Well, I think more automation, more programmatic decisioning. I mean that is just sort of like a natural evolution of the Ad sales business. More and more of that is happening in streaming environments. We look at digital media quite closely as like, here's, here's what you know, here's a playbook for what we're likely going to start to see across CTV and how this is going to evolve. I think for us, we've just had a very strong, even within programmatic, we're talking about direct. Right. In a lot of cases. Right. We have a very strong programmatic direct business. We do very little open marketplace. And I think because of the strength of the ad sales that we've had, and we're in an environment where there's a lot of fast programmers who aren't selling very much of their inventory. They're seeing CPMs that are starting to go down, their fill rates are pretty low, and they're starting to see that maybe the economics here aren't quite as good as they thought they might be.
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Mike Shields
Interesting.
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Patrick Courtney
So they're looking, they're looking for solutions on that. And so we've built our own with Culture Collective to allow.
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Epsilon Representative
What is that?
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Mike Shields
As my next question. What is the Culture Collective and why?
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Patrick Courtney
Yeah, so Culture Collective is a group of partnerships that we've established with Lionsgate Trust, Immediate and Tastemade. We started this a little over a year ago now, where as we've been sort of sold out across our own and operated, we looked at, okay, how can we continue to build on the product that the ad solution that we have, which is reaching multicultural audiences across CTV in this case, and seeing are there other partners that would be a good fit that we could try to put together and curate a differentiated supply of inventory that could be bought contextually across very premium programming. So our first stop is Lionsgate. We've had a great relationship with that group for a while and they've been leaned in on fast for some years now. They've been kind of a first mover in a lot of these spaces when it comes to their, their ilk. And they have channels like Ebony TV and hear spare and single series like Are We There Yet? That fits very well within our positioning with Culture Collect, reaching that multicultural 18 to 34 audience. And they, they're running series like Power on Ebony tv. So you know, this is really premium stuff. And then so we looked at that, we did that partnership with them and then we brought in Trusted Media and Tastemade that also over index on multicultural audiences to put together this type of solution. Because we think especially as it continues to go more automation, more programmatic buying, that scale is definitely an ingredient in how you're going to find success in that way. And so we've been successful to this point and now we're figuring out, okay, as a group of partners here, what's the growth strategy, how do we continue to position ourselves and then we fuse. We're also talking directly with the platforms who. I think what you're kind of alluding to are kind of thinking like, okay, well this is this my inventory. And I'm not, I don't want to give a lot of this out to other players. But being diverse owned media and reaching multicultural audience, we're very complimentary. And so we've been fortunate to do deals directly with platforms like Roku where we can help support their ad sales efforts and make more money for their programmers across the platforms.
- [16:22]
Mike Shields
There's an argument to be made for why doesn't somebody roll up all this fast stuff and build out like a mega ad network. But that would probably perhaps be threatening to some of these partners where you are really doing something specialized. I wonder if, if that's something that helps you kind of have a little bit more of a receptive audience.
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Patrick Courtney
I think so. I mean, I think like we definitely have positioned ourselves in a way where we think that it's a space where we can be effective and we can be complimentary so that we can build something that's sustainable and that we think that we can work across platforms. And so far we've been successful with that. So we're pretty encouraged and we're going to keep building on what we've accomplished so far.
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Mike Shields
I know I've spent a lot of time on fast and we talked about your cable business. We kind of skipped past the fact that you have your standalone streaming service. That seems hard. We've seen the streaming wars have a lot of casualties. What have you found there that's working? How are you sort of surviving through this? And is it, is it because you are serving an underserved audience? Like, what's going on there?
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Patrick Courtney
I mean, you'll hear us talking a lot about FAST because the advertising opportunity is there, right? Yeah, I think on the subscription side, you know, we're talking, I think. Was it today that that New York Times article came out on the, you know, like niche services shutter and others?
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Mike Shields
Yes.
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Patrick Courtney
Yeah, but, but in that article it says like they're getting millions of subscribers. But then they also cite how high the churn rates are and the hopscotching between services and, and it makes for a difficult business. So when you're trying to create original programming to satisfy someone who's paying you on a monthly basis to get the access to that. And then you're splitting that potentially with resellers. If you're splitting that with Amazon or whoever and you're trying to just not only acquire new subs, but then keep those subs when those churn rates are sometimes north 50% on an annual basis, it makes for a really tough type of business. Our position on this is we've generally not looked at direct to consumer. We've looked at what are the reseller marketplaces and how are they going to evolve. And we think that some kind of bundling type of package will ultimately be kind of the end point for a lot of these marketplaces. And that's where we're kind of leaning in as we're figuring out, okay, how can we do that, how can we work with the platforms in the same way we're doing fast is like how can we kind of shape these things with platform partners and with programmers to figure out a solution that everybody can really feel like is economically sustainable?
- [18:41]
Mike Shields
Why do you think this is a tough question for answer but when it comes to multicultural, there's been a lot of attempts at launching a media company for, you know, second generation Hispanics or African Americans online or there's been a lot of attempts at startups to try and bring these worlds together and there's been a lot of companies that just haven't worked. Why do you do you think about that and why. What have you found here that maybe has gotten you through some of the challenges that those companies faced?
- [19:08]
Patrick Courtney
I mean, it's hard to sort of like speculate on other companies and their, you know, the challenges that they may or may not have had. And without identifying any, any of them specifically, I'll say like my background has been prior to Fuse was digital media in which like almost 100% of the business was branded content. And in these digital media environments where a lot of that, a lot of your media dollars are being sort of like brought in through these branded content programs, you tend to have sort of lower margin, lower sell through rate types.
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Mike Shields
Tough to get rep business.
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Patrick Courtney
It's tough, yeah, yeah, Exactly. There's every January 1st you're starting from zero and you got to build the whole thing again and then there's a lot of costs involved to deliver on those right. And the traffic isn't free. You got to go out and get it. I think though, that's partially why a lot of the sort of the digital media players in that space have, have Been challenged at times. And I think like for us, given that we have owned and operated channels, we have a pay TV ecosystem, we have reliable viewership and distribution across these platforms that allows us to transact on media dollars with a higher success rate and a little bit higher margin that's, that's been helpful and favorable to why we've been successful. But I also think that as we evolve and all this stuff continues to converge, the brand content piece like and figuring out where you're going to get your, your distribution and your inventory, it's going to continue to be an important part of the conversation. We're also you know, looking at how we, how we build on, on those businesses. Can't be your only business. You have to diversify.
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Mike Shields
Yeah, I want. It's funny you made me think of this. I wonder what would have happened if, if some of those, the digital media boom with the pivot to video, if they had the fast option around or if streaming was bigger, you might have seen some of those companies go in a different direction. Lastly, what do you see? This is hard to generalize again, but what, what do brands, not really maybe not understand about the multicultural market right now and you know, the different constituencies, what, what do, what do you hear a lot of that you maybe want to dispel or just help brands understand better.
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Patrick Courtney
I mean as far as the multicultural market, I think there's, you know, like, like specifically there are certain things like what I just said, like multicultural is general market. Like it is close to a majority of the population. When you cut that like goes younger the more multicultural you get. And that like when we sell like we have English language, like El Rey Rebel and Latino vibes are English language but they're us, you know, us Hispanic focused channels. And so we try to, we're working on the positioning for those and it becomes this thing like with our platform or distribution side they're like well we have our Spanish language where does this. But they're not Spanish language. So where does it go? And it becomes this like how do you position this type of thing? How do you create these up these general life size channels that over index in particular community but are also sort of mainstream popular channels that, that kind of piece. And on the ad sales side it's kind of a similar challenges on that. But I also think that like fast is still as much as it has grown, it is still like a pretty nascent space. And even the term fast, like you walk in the door of like any random agency and like half the people won't even know what that term means. Right.
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Mike Shields
I've never gone to the show. What are you talking about?
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Patrick Courtney
Yeah, exactly. Like, there's still so much education and still so much maturity that needs to, that needs to happen for us to be, I think, as effective as possible across that. And that's again, why we think, like, it's not like a zero sum game across bass. Like, this is something where we can be helpful in educating the marketplace and.
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Mike Shields
You build the whole thing along with.
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Patrick Courtney
Our platform partners so that everybody, everybody wins, you know, like, like long term, that's it's important for us to, you know, make sure that we have these healthy partnerships.
- [22:35]
Mike Shields
All right, Patrick, great stuff here. Super interesting conversation. Let's chat again.
- [22:38]
Patrick Courtney
Yeah, sounds great. Thanks, Mike. Appreciate it.
- [22:41]
Epsilon Representative
Thanks again to my guest this week, Patrick Courtney of Fuse Media and my partners at Epsilon.
- [22:45]
Mike Shields
If you like this week's episode, please.
- [22:46]
Epsilon Representative
Take a moment to rate and leave a review. We have lots more to bring you.
- [22:49]
Mike Shields
So please hit that subscribe button and.
- [22:50]
Epsilon Representative
We'Ll see you next time for more on what's next in media. Thanks for listening.