Home Ad Exchange News What Quibi Has Gotten Right And Wrong So Far

What Quibi Has Gotten Right And Wrong So Far


Quibi’s woes started at the beginning.

Soon after the streaming video startup launched in April, advertisers that had made multimillion-dollar upfront commitments including Taco Bell, PepsiCo, Walmart and AB-In Bev pushed for new deal terms in light of Quibi’s disappointing download and viewership numbers.

While CEO Jeffrey Katzenberg blamed the coronavirus pandemic for the app’s underperformance, Quibi had also entered a competitive market without content that had a fan base, and its paid subscription business model was a tough sell to consumers who aren’t used to paying for short-form video with ads.

Here’s what Quibi has gotten right and wrong since its launch.

It promised a brand safe and premium environment

Advertisers welcomed Quibi’s promise of a brand safe, premium mobile app filled with hard-to-reach younger audiences, said Tim Hill, managing partner for integrated investment at UM. 

“I can’t think of another company that started from nothing and was able to get $150 million in commitments from advertisers,” he said. “That’s a pretty big achievement.”

That immediate buy-in had a lot to do with trust in Quibi’s co-founders, the entertainment mogul Jeffrey Katzenberg and former eBay and HP CEO Meg Whitman. The high-profile team generated a ton of interest, leading to deals inked directly with CMOs of big brands.

“They were really successful in getting big brands to make a bet on them,” Hill said.

Quibi also offered brands a unique sell with its professionally produced, ad-supported mobile video, especially as more ad-free services hit the market. Plus, the company was trying something new and innovative to adapt to shifting consumer viewing habits.


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“One of the fundamental strengths they have is a brand safe environment with quality contributors,” said Jed Meyer, managing director in North America at Ebiquity.

With those assets, Quibi signed on 10 Fortune 100 launch sponsors, who committed millions of dollars upfront for a year of 100% share of voice at a fixed rate. “Everything was predicated on how much they were able to deliver,” Hill said.

But it was advertiser-friendly, not user-friendly

While Quibi’s offer made perfect sense to buyers, it was confusing for consumers.

Younger audiences watch short-form video on YouTube and TikTok, but they don’t pay for it. And unlike Netflix or Amazon Prime, people won’t pay for entertainment platforms without a breakout hit or a back catalogue of popular shows.

“It’s not the same conversation as wanting to watch ‘Friends’ or ‘Grey’s Anatomy’ on Netflix,” said Ken Harlan, CEO of in-app advertising platform MobileFuse.

People will generally pay for content that lets them avoid ads, but not content that has ads included. (Hulu is an outlier – and it does have an ad-free tier).

“They really missed on the pricing model here,” Harlan said. “They should have a paid option and an advertiser-driven model.”

Because users didn’t follow, its promise of scale fell flat

By promising scale out of the gate, Quibi oversold itself to buyers.

Two months after its launch, the app has only been installed 4.6 million times and is pacing up to 30% behind on some commitments. Quibi projected 7 million paid subscribers within its first year.

Without the scale, Quibi’s not as attractive to buyers.

“Media [companies generally] build their audience before getting support from the advertising community,” Hill said. “They set the bar a little too high and bit off a little more than they could chew.”

Sheltering in place killed Quibi’s appeal

Quibi had to adapt to the less on-the-go world we live in due to the pandemic, and the loss of in-between moments – such as a long commute or waiting in line for a coffee – put the app in direct competition with streaming juggernauts including Netflix and Amazon Prime, as well as new services such as Peacock and HBO Max.

But there’s still time for Quibi to pivot. The company is working on a solution to cast its content to smart TVs to make it more accessible for living room viewing.

Quibi could also consider extending its free trial and making its content more shareable on social to attract more viewers, Harlan said.

Plus, Quibi still hasn’t yet released breakout hit. After all, Hulu was around for 10 years before debuting “The Handmaids Tale.”

“All they need is one hit that everyone is talking about,” Meyer said. “They haven’t had that moment yet.”

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