Quibi, a streaming service for smartphones that offered original shows with short five to ten-minute-long episodes, was launched in early April this year. The founder and board chairman of this company was a famous former Disney executive and founder of the studio DreamWorks SKG. The President was a highly regarded former CEO of HP and eBay.
Examples of the content offered on Quibi are a remake of The Fugitive with Kiefer Sutherland, a version of the prank show Punk’d hosted by Chance the Rapper, and a 6-minute version of TV’s 60 Minutes. The service was marketed as a revolutionary fusion of Silicon Valley and Hollywood that would ride the wave of mobile viewing.
The Chairman and CEO had raised almost $2 billion to launch this company, and unfortunately, it experienced one of the fastest collapses in the history of the entertainment business. In October, six months after launch, the Chairman and President announced Quibi was shutting down. The company finished with 450,000 paid subscribers, nowhere near the 7.4 million it was targeted to achieve in the first year.
So…what were the causes of this short-lived disaster? Here were the key problems:
- • A Streaming Service Only for Smartphones? – Investors, advisers, and employees of the company warned that this streaming service needs to be also available via TV. No market research on this issue was done to check out the concern. The Chairman and President countered that this content was designed exclusively for people on the go, and the warnings were ignored. In October, a few weeks before closing down, it began offering a TV version via some of the larger TV streaming players, but the verdict was already in.
- • No Hit Shows! – Quibi failed to find a single, galvanizing hit show to gain user attention. Again, a bit of consumer research would have probably quickly spotted this problem when trying to catch people’s interest.
- • Flaws In the Quibi App – Users complained that there was no way to share what they were watching on social media with friends, and it was also tough to find specific programming on the app.
The learnings from this unfortunate situation are fairly obvious:
- • Constantly Getting Input from Your Target Customers Is Essential – In this Quibi case, as noted above, investors, advisors, and employees were trying to give input, but it was ignored. Most importantly, there was no real effort to understand the potential of the idea via asking those folks you hope eventually are the users of the service.
- • Don’t Think That Past Success Means You Understand Today’s Marketplace – The Chairman and the President had been highly successful in their careers, and clearly, they strongly believed they knew exactly what would be appealing to users. Overconfidence due to prior success is a deadly disease.
It is amazing. Humans keep making the same mistakes over and over!