12 Jun 2021
Vimeo went public on May 25, 2021 with 200 million users and 1.6 million paying subscribers - a remarkable feat for a company just four years into a completely new strategy.
How did they do it?
Not Original Content
Vimeo is a 16-year-old video platform that many consider an indie version of YouTube. Vimeo’s focus on HD video made it ‘the’ destination for filmmakers of all levels and genres - from novice to pro, from animators to videographers.
Going into 2016, Vimeo’s strategy was to invest in original content and become an entertainment destination competing with Netflix, Hulu and others. There were problems with this direction however.
Original content was not getting cheaper.
The streaming media marketplace was crowded.
Customer acquisition cost was high.
Not solving new or existing problems for video creators.
Considering these factors, Vimeo switched strategy in 2017.
Old strategy. Become an entertainment destination where viewers watch with a paid subscription.
Old value proposition. Original content.
Video is a very engaging format. Over 80% of internet traffic is video.
It is great for marketing. On social media, video gets three to four times more clicks than images or text.
It is great for education and training. Think employee onboarding for distributed teams or product demos.
It is also a great way to engage with a remote audience. Think livestreams combined with graphics where the audience can interact with the presenter.
The opportunity? In 2017, a platform where users could do all of this in one place was practically non-existent. Vimeo understood this as a big, underserved market, and decided to pivot from a media company competing with Netflix, to a SaaS technology company.
Vimeo’s new mission is to unlock the power of video for everyone.
The yoga instructor wanting to stand up their own livestream + subscription service.
The small business wanting to generate regular marketing content for social media platforms.
The corporation wanting to securely broadcast town halls and trainings to offices all around the world.
The product team wanting to demo new features to their sales and marketing teams.
The professional video team wanting to collaborate on a video edit.
The marketing team wanting to analyze how their videos are performing on social media platforms.
At the end of 2020, Vimeo had over 1.5 million paying customers generating $83.8 million in revenue in Q4 alone.
New strategy. Technology company that invests in tools for video creators.
New value proposition. Simple tools for any professional, team, and organization to create, manage, and share high-quality videos.
How Did Vimeo Do It?
Vimeo’s CEO, Anjali Sud, who led Vimeo thru its transformation, explains it best in her talk ‘How to change the course of your company in 90 days’.
Rip off the band-aid. Vimeo stopped all investment in original content. They reallocated large portions of their product and tech teams to work on new projects, and built an executive team to lead their new direction. The tip - don’t be afraid to do the right things even when they are unpopular.
Everything starts with vision and values. Redefining vision and values was a critical exercise for Vimeo. It helped the entire company coalesce around a single goal. It also helped employees process change within the context of Vimeo’s long term strategy.
Look where others aren’t looking. Video tools weren’t as sexy as content. While Vimeo’s majority focused on content, a small team worked in stealth mode to figure out how to better serve creators. They conducted product discovery, built and launched a business product and convinced Vimeo that it could reinvent the cloud video tools space.
Own your shortcomings and fix them. The more self aware we are of our shortcomings, the better we’re able to address them. Livestreaming was a number one feature request for Vimeo. The company tried to build this capability in house. They quickly realized that they lacked the expertise and acquired Livestream to bring a best-in-class solution to users.
Lead with mission, execute with focus. It is easy to get distracted by what others doing. But staying focused on the mission helps avoid paths that can dilute impact. Vimeo has tools that allow easy distribution to YouTube and Facebook, both of whom were competitors at one point. The decision to enable this was made easy by Vimeo’s mission to empower creators.
Build a better product. Focus on bringing long term value to users. Ask relevant questions. Are people engaging with our tools? Are we actually making businesses more successful through video? Are we bringing video to more people?
Needless to say that Vimeo has competition!. These are primarily from tools that focus on a single area from Vimeo’s repertoire. Offeo, which is similar to Vimeo Create, does marketing videos alone and offers a fully featured product at a cheaper price point. Streamlabs offers nearly the same livestreaming features as Vimeo Livestream, but for cheaper. And then there are platforms like Wistia which are in direct competition with Vimeo.
Vimeo’s strength lies in its mission to continually innovate in the video problem space - and this is helping them deliver innovative solutions. They’ve built tons of features and app integrations. One example is Vimeo’s Shopify integration that enables storefront owners to create marketing videos in just a few clicks. Vimeo Stock is another one which allows creators to monetize stock footage. A true hard-to-copy, however, is Vimeo’s OTT which enables anyone to stand up their own Netflix like subscription service. I’m sure there’s more from where that came from.
Keep it going Vimeo!