Video Television Production Business Plan

Home Division:
There are no production companies in the area which currently focus on video scrapbooks. Several smaller companies “can” and “will” produce this for a high cost to the customer. With the advertising by both Apple and Sony focused on home digital video production, the awareness of this type of production is growing within the community, but as yet, no company has stepped up to the plate to offer this product. Consumers are becoming more educated about what can be done, but they do not know how to do it themselves.

For several months, EvergreenTV Productions has promoted this concept via word of mouth to small businesses, consumers on the street, and educated professionals. All show a keen interest in buying the product.

Tour and Travel Division:
Many production facilities exist in the Tampa Bay Area; and all are capable of producing professional projects. As this is a referral division only, we do not plan to compete regularly for business. Instead, we will build a web of quality prospects by maintaining high productions standards, and accepting only those clients who come highly recommended. This is not our main focus, but is a tool to generate business and reputation.

B2B Division:
EvergreenTV Productions focuses on the bottom 115 (Nielsen) tv markets. These are the markets whose station budgets don’t easily allow an expense of $20,000+ per year for programming services. We will offer the affordable alternative.

EvergreenTV Productions conducted a mail-in survey of 113 stations in the bottom 65 markets. The majority of these do subscribe to CONUS, Dr. Dean Edell, MedStar, or Medical Breakthrough. Of the 10 responses received, four stations did not subscribe to any news provider, but did indicate an interest in “filler news” at a reasonable cost. The conclusion is that many stations need stories, but cannot stretch their budgets to accommodate the high cost of programming. At this time, no service exists like EvergreenTV Productions programming alternative. Numbers for projected growth are not possible without history.

Market Segmentation

Three loosely defined market segments are identified. The “Home Division” category  is by far the largest potential segment and represents the consumer most likely to be our client. 

Target Market Segment Strategy

Home Division:
Strategy for the home division is two-fold. First, we must find the appropriate means to communicate our product to potential customers. Because nearly everyone today has the ability to take photos and has a wide selection of photos at home, we must first narrow down our customer base by appealing to the emotions people attach to their photos. Older persons with larger families are more inclined to want to share their family histories. Newlyweds want their family and friends to share in their newfound happiness. By emphasizing these traits (nostalgia and euphoria) we can begin to gain a following for our product. Second, we must find a suitable location for our storefront, which enables us to find customers who share these traits. Malls and movie theaters appeal to “togetherness,” shopping together for gifts, weekend outings, brunch/lunch/dinner dates. The right location will give us access to our primary customers, those who will help us launch the product in the area by word of mouth.

Tour and Travel Division:
This division’s strategy relies entirely on our referral program. Doctors’ offices and travel agencies give us a wider demographic schematic, as patients and families of patients are confined to a waiting room during a visit. Instead of watching afternoon televised programming, doctors will be able to provide their clients with informative, educational and entertaining programming as compared to many daytime talk shows.

B2B Division:
Because EvergreenTV Productions utilizes the stories of university students, it is important to recognize the average age of a station’s reporters. A previous survey conducted by our company did confirm our experience, in that most small market tv stations hire only young “cub” reporters, as experienced reporters tend to move onward to larger markets and bigger stations. The quality of our product will match the quality of the station’s news. Therefore it is essential to target the bottom markets. This is also important to recognize from the service end of our business, as news directors will be interested in hiring reporters from our pool of news stories.

Market Growth

Home Division:
We will be better able to track market growth in this division following the first two quarters of sales. At this time, with no active competition, we expect our growth rate to double and triple weekly. As Tampa Bay is a large retirement community, these numbers could be increasing for several quarters. We then expect to see a slight down curve as the product finds its niche within the community, with a more consistent level of sales.

B2B Division:
Market growth can only be gauged by comparing the numbers of programming companies now available to those present a decade before. Ten years ago, Dr. Dean Edell was a radio host in San Francisco, now he’s available in dozens of tv markets nationwide. While the number of markets is not diminishing, the size of each market is changing. Depending upon population readjustment, the markets themselves adjust every year. One station may be in Nielsen market 110 this year, market 98 next year, and market 113 the following year due to population decline in year two and growth in year three.

Market Needs

Home Division:
With the advent of digital editing capabilities on home computer systems, more consumers are aware of the potential of creating video scrapbooks, but most are not familiar enough with the technology to accomplish a simple video. Apple and Sony are selling large numbers of these computers despite a recent turndown in the computer industry. Digital still cameras are a must have, with consumers expanding their vocabularies to include “Memory Stick,” “Pixels,” and “Jpegs.” Yet, in the Tampa Bay area, no production companies are actively marketing video scrapbooks. We can use the above product interest, and the continued success of photo processing centers, to create a gauge for interest in this product. However, as with any relatively new product, we will not know the market’s true needs until several quarters of sales.

B2B Division:
A void currently exists in the area of news programming. Larger stations are able to budget tens of thousands of dollars per year to support their needs. Smaller stations often rely on extending the weather and sports segments, or sitting on credits at the end of cast to “eat up extra time.” This reduces the newscasts’ value, and thus reduces the price of selling advertising as commercials, which is where tv stations make money.

Other small markets may subscribe to one or two programming services, at the expense of hiring quality personnel. These services limit the news directors and producers, because they have to run whatever story comes down on the satellite link that day. It may have nothing to do with other stories in a cast, or interest to the local viewing audience.

EvergreenTV Productions allows the stations to pick their own stories and run them when needed. In addition, by ordering weekly, they can choose from a constantly upgraded catalogue and pick stories which relate to news they are already running or have run recently. In other words, on a slow news day, CONUS may offer a story from a station in another state about a family lawsuit which has no relevance to that station’s viewers. EvergreenTV Productions, however, may offer a story about “Buying a puppy for your five year old.” It is timeless, and applies to a greater percentage of the viewing audience than the distant family’s lawsuit.

Within the service branch of this division, there is a greater range of competition, but few meet student’s needs. Many news talent agencies and resume services exist. However, none of them offer posting of resumes, marketing of resume tapes, and especially an opportunity to earn professional experience while the student is still in college, at no cost to the student. By positioning themselves with EvergreenTV Productions, students can hone in on various stations who have purchased their stories. They can link directly to those stations for future jobs, rather than send out a multitude of resume tapes in a shotgun style to get a foot in the door. And, they will not have to pay our company 10% of their first salary!

Market Trends

Home Division:
The advent of home computers capable of digital editing can certainly be considered a market trend, and one that is highly influential to our home division. As more consumers know of the technology, more interest is created in our product. While large corporations spend millions in advertising to promote these computers, we can take advantage of this advertising second-hand. The interest is created by the large corporations, and we use like advertising and terminology to increase interest in our particular product. A second major trend is with photo processing centers, such as those at Walgreens, offering pictures on CD-ROMS. These centers are already taking pictures to the next level, with the purpose of sharing these memories with family and friends. The logical next step is to put these pictures together in a creative and professional video scrapbook, then copy them to VHS tape or DVD.

B2B Division:
One major trend in the television news industry is staffing cut-backs. Newsrooms are using fewer reporters and photographers and replacing them with bought programming. Instead of paying $18,000/year for a reporter and $16,000/year for a photographer, smaller markets are buying news programming services at $20,000/year and saving on salary and health care expenses, while increasing the number of stories running per day. On average, a reporter will turn out one or two stories per day, while CONUS offers the ability to run two or three stories per day.

Another trend focuses on freelancing opportunities for reporters. Many are now working on their own, producing stories bought by several different companies. As tv begins to reflect the magazine industry in freelancing opportunities, more and more reporters will make a living working for themselves. In a long-term analysis, EvergreenTV Productions will be able to utilize these freelancers to do specific stories which fit the mission of our company.

A third trend is greater reliance on the Internet for programming. With the advent of TIVO, viewers can choose what they want to watch when they want to watch it. An even further long-term analysis could lend EvergreenTV Productions the opportunity to provide news that viewers can access specifically without going through their local tv stations. In the short term, local news stations may soon be able to download news stories directly to their control centers, without needing a tape for playback. By initially locating on the Internet, EvergreenTV Productions is putting itself in the position to take advantage of the increasing opportunities of Internet business, while at the present time offering easy access to a catalog of stories for order.

Service Business Analysis

Home Division:
We are primarily a production company within the retail industry. Some industries are similar, but as this is new technology, it is a unique industry. At the current time, we know of only a few other production companies which consistently turn out video scrapbooks. The photography industry is similar in creating still pictures for retail.

1. Production companies: Most are individually owned and rarely produce small projects such as video scrapbooks. We do not know of any production companies designed solely for this type of product, but do know of several small corporations who have similar guidelines. The downside to these companies is that they are limited in timely production ability. They cannot accept 10 orders for video scrapbooks simultaneously, as they are set up to produce one scrapbook every two to three days, rather than two to three hours.
2. Photography companies: Like-minded companies which produce wedding, family, vacation, etc., still photos for families to treasure. They do not produce video scrapbooks from these photos.

Tour and Travel Division:
We are limiting our production output in this division to a referral basis only. In general, the production company industry is very large, with companies specializing in corporate training videos, tour videos, advertising, etc. They rarely limit their productions to referral only, which means most often they will specialize in one area. To the customer, this means outsourcing to several production companies to meet his needs. A corporate president may have to hire two production companies to produce a training video and a travel video.

B2B Division:
We are both a marketing service and news provider. Therefore, half of our business deals within the marketing industry, promoting students, while the other half deals within the news industry, selling news programming to news stations.

1. Marketing services for students:
   • Industry magazines: For a nominal fee, students seeking employment can post a want ad, specifying the type of job they are looking for. These magazines have good responses from tv stations advertising jobs, but have a lower success rate for students seeking jobs.
   • Internet websites: For a nominal fee, students may post their resume and information on an industry targeted website such as www.tvjobs.com. Thousands of students and currently employed reporters compete for the same positions, again with lower success rates.
2. News Programming:
   • Network-based programming: Affiliates belong to network news services which provide daily programming on hourly feeds. These stories are limited in region and topic, extremely time-sensitive, and restricted to the affiliation only. NBC affiliates belong to NBC Newschannel. ABC affiliates belong to NewsOne, etc.
   • Subscription programming: For an annual rate, any affiliate may subscribe to these programming services. Their downside is in limiting the stories they offer to one specific topic such as healthcare, travel, or politics, rather than offering a wide variety of topics from which to choose. In addition, stations do not have a choice in which stories to run each day. Either stations can take one story daily from a satellite feed, or stations are sent a week of stories on tape.

Business Participants

Home Division:
Most production companies have a full plate with a wide assortment of projects. They are benefiting from the growing need for corporate advertising/projects, and prices on production equipment are continuing to fall.

B2B Division:

Student Services:

1. There are hundreds of national talent agents within the tv industry. A select few work with esteemed firms and take on only proven, exceptional talent. Hundreds of others are available to college students for a fee of 10-13% of their salaries. This is where agents make money, searching for a job for the students, gaining an interview, then reaping the rewards. Fewer reporters are looking for agents due to the fee and the increasing abilities of the Internet. Like travel agents, talent agents are finding their once lucrative positions threatened by the Internet.
2. There are dozens of job search services available, more in the past few years due to the insurgence of the Internet. Most require an upfront fee of $10-15 per month for resume posting service, and the privilege of searching for jobs on their website from those stations which have subscribed to them. They will continue to do well as long as reporters are seeking positions.

Station Services:

1. While there are many production companies, few offer news to tv stations. Most programming services are based in larger markets where their product has taken hold. They offer topic specific news for tv stations nationally, at a high cost. Most generate stories by one well-known personality and offer only one story possibility per day. They make the majority of their revenue from mid-to-large markets. They have a strong position in the industry, and because they are topic specific, do not threaten each other. Internet news on demand, where viewers can watch their favorite station from their home computers, is the biggest threat.
2. Freelance reporters infrequently sell their stories to stations.

Distributing a Service

Home Division:
Customers are accustomed to going into retail locations to make purchases or place orders. Having a storefront will provide them with this opportunity. Initially, we will host presentations to explain the product at various outlets such as retirement villas and apartment clubhouses.

B2B Division:
TV Stations buy directly from the programming source. A sales representative may call or visit a station for a programming product, or the station may purchase directly via the Internet.

Initially, it will be vital for us to visit one-on-one with small market stations to obtain a base clientele. Those stations across the country will be targeted via telephone and direct mailing promotional kits. Those stations which responded to our initial marketing survey are prime first clients–those who have already defined their needs according to our questionnaire.

Competition and Buying Patterns

Home Division:
As with any retail line, customers feel more comfortable and believe they are truly getting their money’s worth when they are given one-on-one attention. It is this attention we will give them in our 30-minute free consultations. Our customers will be more inclined to refer our business and product to friends and family if they believe we do not see them as simply a sale, but as people with needs being met. At the same time, it is essential we see the photos the customer is bringing in, and have the customer present to ask questions and verify the photo placement within the video. This initial attention to detail will also provide our customers with the knowledge that we will produce exactly the video they have in mind.

B2B Division:
TV stations are prone to purchase news stories based on the bottom line. If one programming service becomes too expensive, the station will spin off to another programming service for a few thousand dollars less. Small market tv stations do not have this option, as most services are too expensive for their budgets.

EvergreenTV Productions will offer quality news stories at a very competitive price–in fact, half the cost of most other programming services–to gain access to those smaller markets. In addition, having a variety of news topics makes us a hot choice. Stations do not have to spend thousands for only one brand of news, i.e., health stories. They can choose from a wide variety, health, politics, financial, innovative, unusual, personalities, etc.

Main Competitors

Home Division (Video Scrapbook Production Companies):

Family Tree Videos:

Strengths: A franchise production company geared toward genealogy, but includes producing video scrapbooks. Good-looking productions revolving around family interviews, documentation, and photos.
Weaknesses: The formula is too complex to generate quality products in quantity. Many smaller production companies learn this method first, then give up due to lost time and not enough revenue.

Independent Companies:

Strengths: Nationwide, dozens of independently owned production companies produce video scrapbooks. Most are your neighbors, businesses you want to trust.
Weaknesses: Quality is inconsistent and depends entirely upon the owner’s ability. If you’re not a close friend or family member, you may not get the product you really want or thought you ordered. Due to time constraints and the need for revenue, many of these smaller companies will put video scrapbooks on the back burner for bigger projects, such as weddings.

B2B Division (Programming Services):

Dr. Dean Edell:

Strengths: Well known after years of radio and tv broadcasting. Big service, using satellite feeds to get stories to stations. National image, high volume.
Weaknesses: Very expensive. At the top of the scale at $24,000+ per year. Limited to one topic, health news.

MedStar:

Strengths: Competitive pricing, less expensive than Dr. Dean. Utilizes chain of universities for national syndication.
Weaknesses: Still too high a cost for smaller markets. Limited to one topic, health news.

TravelNet:

Strengths: National syndication, high volume. Has satellite feeds to stations.
Weaknesses: Generic writing for travel pieces. Limited to one topic, travel news. Too high a cost for smaller markets.

Mrs. Fix It:

Strengths: Appealing change of gender, national image, excellent writing and presentation.
Weaknesses: Too high a cost for smaller markets, limited to one topic, do-it-yourself home/yard/car improvements.

Many other services fall within this category, too many to mention. Some are purely regional and do not appeal nationally. Most are of high cost to small market stations. None that we’ve found offers a variety of news topics.