Why are European broadcasters snapping up YouTube networks?

StyleHaul’s James Stafford

Following RTL Group’s acquisition of a majority stake in StyleHaul earlier this month, the YouTube fashion and beauty network’s vice-president for Europe, James Stafford, explains why he thinks broadcasters are being increasingly drawn to multi-channel networks.

When I was growing up in Australia in the 1980s, we only had three TV channels available (for some reason called Seven, Nine and Ten). If you managed to hijack your antenna with a coat hanger, you could also watch low budget public service TV on ABC. I heard rumours about an international channel called SBS but my family never saw proof.

So, at any one time we really had three choices of what to watch on TV. Like every family at the time, including those, I imagine, in the UK, there were the inevitable arguments about what to watch. And heaven forbid you were five minutes late for your programme because then it was lost forever.

I happened to like music TV, which meant I had a two hour window on Saturday mornings to watch a programme called Video Hits. Essentially this was just back-to-back pop video clips, but as someone who loved music, this was my only opportunity to connect with the thing that I loved. It could only be two hours because the antennae bringing these pictures and sounds into our home were busy bringing in everything else – news, talk shows, comedies, food shows and obviously a lot of Neighbours and Home and Away.

Then in 1996 something miraculous happened. A full 15 years after it had launched in the US, MTV came to Australia. A channel that did nothing else but music. All day, every day. And the hosts – they loved music as much as me, they spoke like I did. It was the best thing ever. All this was possible because that coat-hanger antennae had by now been replaced with a magical pipe. A cable that brought dozens of channels into our home. Sure, the quality was appalling, but I didn’t care, and of course it improved massively as the cable TV industry grew in the ’90s.

I was reminded of this last week while I was watching the MTV European Music Awards. Now in their twentieth year, they are just one part of a global franchise that is without doubt the leader in discovering, promoting and celebrating musical talent globally. And all this emerged from those cheap and improvised days as music’s pioneering voice on television.

Today we don’t talk about antennae or cables, because the ability to create, share and consume content is unlimited. Huge multinational broadcasters have the same ability to find audiences as somebody in their bedroom with a webcam. I know this particularly well because for the last four years, I have made it my business to understand the growth of the latter: vloggers, YouTube stars, internet-celebs; call them what you will. My first experience in this world was at YouTube where I was responsible for Branded Content in Europe. Advertisers were wary of the low quality and improvised content that was so popular, while audiences were devouring it. Of the four billion monthly views on YouTube, what people would consider as more traditional, professional content accounts for less than 5%.

The growth of YouTube content is exactly what we saw back in the 80s when cable TV arrived. As more channels – unlimited channels in fact – are piped into our homes, on televisions, phones, tablets and laptops, the ability of those channels to focus on a specific interest-area and do it well increases. And if you love music, like I do, you don’t just want two hours a week – you want it all the time. This is exactly the reason why YouTube channels are seeing spectacular growth and engagement. Take Whistle Sports, in which BSkyB recently invested US$7 million. Its growth is based on a simple insight – if you love sports, 90 minutes is never enough. If you love sports, and there’s suddenly 30,000 videos available to you, of course that’s a great thing. Their 9 million subscribers obviously agree with me – together they’ve watched over 1.3 billion videos.

About a year ago, I decided to leave YouTube and join StyleHaul, a YouTube network for millennial female audiences that is currently the largest in fashion, beauty and lifestyle-driven content. StyleHaul was founded in the US in 2011 – on almost exactly the same day that my beloved Video Hits was cancelled in Australia. With over 5,000 channels in 62 countries, we’re able to create regular and engaging content. Instead of catering to just fashion or beauty generally, we have thousands of niches covered – nail art, goth fashion, make-up tutorials, haul videos and many more that will be the main content consumed by your teenage daughters and nieces, so ask them if they know who Zoella is and take note.

Earlier in November, we at StyleHaul celebrated our acquisition by RTL Group, Europe’s leading entertainment company. We’ve been part of the RTL family for about a year since they, along with BDMI Ventures, invested in our future. The benefits for StyleHaul are obvious – being part of a multi-platform entertainment company opens exciting doors for our growing talent. Together with FremantleMedia, we’ve launched the first of our ten-series original content deal with The Crew (five million views and counting). We’ve also been able to open offices in London, and Singapore, which are crucial to capitalise on the rapid growth in all markets globally.

In many ways, what RTL Group saw in StyleHaul when their investment valued us at over US$150 million was the same thing that made me decide to take the leap too: the ability to revolutionise the way we create and consume content, which is the same thing that happened all those years ago when MTV was gloriously streamed into my home in Sydney. Each month, our network has over a billion video views, tens of millions of comments and countless tweets and social interactions. We obsessively monitor these rich data insights and use them to improve the quality and engagement of our 5,000 channels. We have teams that specialise in audience development and search-engine optimisation. We help open up new revenue streams like sponsorships, e-commerce and branded content deals for our channels. Influencer brands that didn’t exist more than a few years ago are now topping the bestsellers list (see Zoella and Alfie Deyes). As we extend to other social platforms like Snapchat, Instagram and Twitter, we’re re-writing the playbook. Right now, these skills and experiences simply don’t exist outside of the nascent YouTube network world.

And here’s the exciting thing: we’re just getting started. One day very soon, you’ll be watching our version of the MTV EMA’s featuring people who got started in their bedroom, recording videos about the things that they loved the most.