There’s no doubt that the coronavirus took an unforeseen toll on a wide array of businesses. But the opposite can hammer operations, too, as some systems suddenly deal with surges for everything from food and other essentials to social media.
Marco Polo, an eight-year-old asynchronous video platform, knows this firsthand. So in the face of a usage spike amid the pandemic — and agape at the mushrooming related costs — the company decided to announce two new features designed to better monetize the business.
Free users know the platform as a video chat app that foregoes pre-planned or scheduled live calls. People can quickly and directly record thoughts or other messages and receivers view it at their own leisure.
Now, the new premium Marco Polo Plus aims to take the experience up a notch. Replacing a previous paid subscription program, the Plus plan offers HD video, a voice-only option, custom emojis, the ability to scrub or fast-forward through clips at 1.5 to 3x speeds, a scratchpad for personal notes and referrals to share Plus “passes” with friends for free. The annual fee for the original accountholder breaks down to $5 per month.
The offering debuts alongside Channels by Marco Polo, a new program targeting influencers that allows them to build a paying audience.
According to the company’s blog post, “Channels allows leaders to authentically connect with their audiences at a large scale, efficiently, without the hassle of billing, member management, changing algorithms or high-production video requirements.”
Indeed, it looks like Channels account holders can shoot off a video quickly, and as with the original system, allow people to view at their leisure.
These account holders or “leaders” pay nothing to set up a channel, and they set their own prices, Vlada Bortnik, chief executive officer and cofounder of Marco Polo, told WWD. The company takes a 10 percent cut after administrative and credit card fees.
“We see Channels by Marco Polo as a way for independent entrepreneurs, like fashion and beauty influencers, artists, teachers, and many more, to get paid for the time they spend doing what they love,” she explained. “We designed Channels with feedback from numerous influencers, and they repeatedly expressed their frustration with the way the changing algorithms in other platforms have made monetizing their business so much harder.
“Specifically, influencers are using Channels to create a new revenue stream where some of the people following them opt to pay a monthly membership to join their channel, get more personal access to them and view exclusive content they can’t get on other platforms,” she said.
In addition, Marco Polo’s asynchronous format allows Channels leaders to stay in touch with their audience whenever it’s convenient for them, Bortnik added. Here, they can connect in a safe, trusted space with others who care about the same topics.
That stands in contrast to the swelling, often vitriolic masses rife in places like YouTube. And as the big YouTube machine churns — according to parent company Alphabet’s latest earnings, Google’s already enormous video platform is seeing further usage spikes during the pandemic — standing out amid the cacophony is often an exercise in futility.
Marco Polo may not match YouTube levels, but its reach is not insignificant. The app, which boasts fans from Ice-T to Amy Poehler, saw a dramatic rise with new accounts ballooning at a 16x multiple and activity that tripled in March. The company hasn’t disclosed specific usage figures, but instead pointed to more than 10 million downloads in Google Play and noted that more than 3 billion “Polos” have crossed its platform.
Earlier in April, the community sent 20 million Polos in one 24-hour period, according to company data. Its #PoloTogether campaign, which urged users to reach out to friends who are lonely and isolated, spurred more than a million check-ins.
The platform’s popularity ties into its fundamental premise. In general, Marco Polo encourages users to create intimate friend groups, rather than nab as many followers as possible. The result, it believes, is personal communication that feels more authentic — which can be highly prized during an unnerving global pandemic.
“We have been steadfast in our commitment to help people feel close, and today we realize how urgently important that work is to help prevent the ‘social recession,’” said Bortnik. “Human connection is having its long overdue moment. And we are here for it, as we always have been.”
As a system that banishes irritating back-and-forths to schedule a live chat or the sometimes grotesque comments in livestreams, the benefits seem apparent.
The recent growth in activity has become both a blessing and curse, though, as it spotlights issues like server capacity and other limitations.
What complicates matters is that Marco Polo eschews advertising. Given that its venture capital-funded coffers can only go so far, it had to find another way to cover increased costs.
It’s not clear if users will go for these new models. Fortunately for them, the company will still offer its free version. But Bortnik hopes that users will turn this step into a sustainable model for the business.
It’s a familiar quandary, especially in recent days. The stampede toward online platforms is creating opportunities and challenges that are bearing out across the tech sector. For instance, although YouTube usage cranked skyward, ad spending dropped.
TikTok, known for its short videos chronicling pranks and lip-syncing, was gaining steam before the crisis. But during the COVID-19 outbreak, the company reportedly saw an 18 percent boost in downloads, with some estimates pegging downloads of 2 million between March 16 and 22, a sharp increase from the 1.7 million downloads tracked the week before. February’s total of 6.2 million downloads appears to have been dwarfed by March: Across most of last month, the app saw a 27 percent increase in downloads.
It’s not clear if TikTok suffers from any coronavirus-related ad sales challenges. But Levi Strauss & Co. reported early success last week from its partnership with the platform to sell product in the face of store closures.
On Wednesday, another signal of COVID-19’s impact on social media and the digital ad business was revealed, as Facebook announced solid earnings growth in the last quarter.
Like other social channels, Facebook saw traffic jump across many of its services, it said in a blog post last month. However, a lot of the activity happened on apps like WhatsApp and Messenger, which aren’t monetized. The social giant seemed eager to set expectations, divulging that its ad business weakened “in countries taking aggressive actions to reduce the spread of COVID-19.” But then on Wednesday, the company reported that ad revenue has stabilized.
The environment seems to be changing rapidly and unpredictably. For emerging social apps like TikTok and Marco Polo, that means they need to cement their footing while contending with a flood of activity. And these next few months may be key in determining how well they can ride the wave.