/Drive+ Retention Rate (Update #2: Unsubscribers)

We could go back and forth all day about whether or not /Drive should have switched to a paid subscription model rather than a brand/advertiser subsidized one. I'm more concerned with whether or not they're still making the money they need to be.

EDIT: Updated with some more info.

EDIT 2, ELECTRIC BOOGALOO: Updated again, hat tip to djmt1!

/Drive just reached 1,000,000 subscribers, but their Drive+ videos seem to be getting significantly fewer views than before, and it's now a question of whether or not they could end up in a spiral where they don't get enough subscribers to pay for good content, which causes more subscribers to leave.

So there's three questions I want to know:

1. How much money were they getting through Youtube's content subsidy?

2. How many subscribers are they seeing actually retaining and paying the $3.50?

3. How much has their budget expanded, to try and serve 3 outlets?

The inherent problem I see with this model is that once user have subscribed for a year or a month, they won't subscribe again. This means that if the budget runs short, they either have to draw in more subscribers or they have to shoot fewer videos. This would be fine if they produced lots of varied content for the average person, but Drive is a niche show. There is a limited amount of users to pull subscriptions from.

That means that once they have drawn on their initial pool, if they aren't reaching enough income, they not only can't expand but they won't be able to dish out the longer, high quality videos to whom they need.

From what I would guess, they have at most 10,000 subscribers on Drive+, with a retention rate of about 5%. That would yield 10,000 views out of 175,000 views on a non-paid video. I used the Sharkwerk video as a fair estimate. The same ~5.5% value holds for the LaFerrari video, but the M3 video has closer to 8%. This is perhaps because it is newer, and subscribers tend to watch newer videos earlier rather than later.

So that means that they are, monthly, likely making $40,000/month, +/- $15,000, but more likely on the high end as some videos are cracking 15,000 views. Basically, my question is, is this enough to support all of the content they had before, + Drive on NBC sports + the added length Drive+ videos?

EDIT: Okay, I found this:http://www.gizmodo.com.au/2014/07/the-ec...

Supposedly the LaFerrari budget was around 9000 euros, or $12,000. Assuming that most videos are half that cost (it seems to be at the high end of their cost), we can assume most of their videos have a $6000 budget or so average per video.

At their peak before the break, they made 16 videos in a month, From April 10th to May 8th 2014.

This means their monthly budget would average 16*6000, or $96,000/month.

They need a minimum of 24,000 subscriptions at $4 a piece per month. This means that they must have either a ton of videos not watching, or they are not nearly meeting their budgetary needs.

So... does this mean that they are going to have to cut their budget?

If you don't like opinion, ignore the rest of this article:

Facts aside, and time for a bit of opinion, I also think the way they went about it was completely unprofessional. I've only seen it revealed in comments and twitter posts that the decision was made because of their funding contact with Youtube ending. Not only that, but at no point did they express the cost of the videos to their viewers, just assuming that people will understand it. They should not be surprised that people are "thumbs downing" their videos at a rapid pace.

To do it right, they should have had a clear beginning to their "break", a clear ending (both marked with brief videos that explains why they took the break, which has also only been talked about in comments, leaving most people to still be confused about why the channel dried up). Then, they should have had a video that outlined the financial situation and their costs, maybe even asking for viewer suggestions about what they would like to see.

Then, they should not be trying to provide 'teasers" for people who want to be a part of Drive+. Have some content on Drive, some on Drive+. Do not try to give us 3-4min snippets of what should be 15 min videos. The viewers will choose where they want to go and if they want to pay for it, trying to entice them is more likely to result in them not subscribing because

The only reason I can see why they throw up these 3-4 minute teaser videos is that if they didn't, they would have no content on the regular drive channel to put out. This is reasonable, but without knowing if they are truly limited in their budget, it's hard to say.

The channel has had 30 minute videos of dudes just talking about cars. Why is that suddenly impossible to do again? Why can't they have 1-2 minute videos about dudes talking about the channel?

And most importantly, why are they using stand-ins, different voices, impersonal graphics, and refusing to show scenes of the crew in the videos? Leo Parente, Matt Farah, and Mike Spinelli are bankable assets that seem to have been completely underutilized in this transition. People need something to hold on to if you're going to change the game on them, and these guys are that rock. Chris Harris is nice, but he's just one part of a bigger channel.

Opinions over!


Anyway, anyone know more about /Drive and Youtube and have some insights into their financial proposition, their budget expansion plans, and whether or not I should be concerned about their ability to continue to provide content a year from now?

Update:


http://drive.jalopnik.com/a-slight-lift-...

I was just alerted to this article (which I hadn't read yet because of how new it is) by djmt1. It seems to me that J.F. is fully aware of the backlash and while they received tons of initial subscriptions for the trial period, they were worried about people unsubscribing.

Reading between the lines, I'd say that if you want them to switch to another financial platform, the best thing you can do is unsubscribe. It seems straightforward, but they are using that as a metric for deciding whether or not this is working. I don't encourage this, but I am offering it as the most likely way to send that message.

I would also suspect that it is very likely that they are seeing a rate of unsubscription bad enough that they already won't commit to a year-long subscription.

This means if you don't like their platform, go on the trial, and then go off the trial before your card is charged. It doesn't cost you money to do that, but it does send a message (and you get to see some videos for free). This amplifies the effect of "We have enough people who like us, but not enough who are really going to pay for it" enough to make them decide to use another platform.

If you do want them to stay on the same platform, do the opposite. Subscribe, pay for it, and comment positively. This will send an equally strong message that they should stay with this model.