Why Prime Video's Mr Beast gamble can fuel Amazon's advertising business

Amazon Prime Video has embarked on a big bet that could reshape the relationship between streaming TV and content creators. Long rumoured, the deal between YouTube superstar Mr Beast and Prime Video was made official on Tuesday (March 19th, 2024) with some headline grabbing details. Known as Beast Games, the reality series will see 100 contestants competing for a $5 million prize. Amazon has dubbed it the “biggest single prize in the history of television and streaming”. This is territory Donaldson has previously occupied with his YouTube videos. In 2021, he made an unofficial recreation of Squid Game with a prize of $446,000 that became his most popular post, with more than 589 million views. It was published two years before Netflix aired the first episode of Squid Game: The Challenge in November 2023.

As MIDiA cautioned in February, content creators do not always replicate their success in streaming TV shows. This is particularly acute when they are being used for their fandom rather than their creative input. Think Addison Rae’s appearance in the Netflix flop He’s All That . 

However, there are arguments to suggest that the Donaldson /Prime deal could be different. Firstly, the YouTuber with 246 million subscribers claims to have full creative control as presenter and executive producer of Beast Games. One will expect Donaldson to deploy all the attention-grabbing tactics of his social videos to encourage audiences to watch multiple episodes back-to-back – think high stakes content and punchy editing. The question is whether such tactics can be successfully replicated on a streaming TV platform. One media executive with experience of both the streaming TV and social space said that bringing these respective audiences closer together was like merging an art gallery with a children’s playground.

Making the leap from social to streaming TV

Beyond choosing a show, streaming TV remains a lean-back experience. Meanwhile, a Mr Beast video is lean-in, with users encouraged to comment, like, share, and show their loyalty by paying £4.99 a month to join as a channel member. One of Prime Video’s biggest challenges is how it captures this kind of engagement once it has got the Mr Beast audience through the door. Is this the time for Prime Video to re-energise its watch party service? A function that Amazon-subsidiary Twitch is removing due to lack of engagement. Or, has this opportunity come too soon for Prime Video’s user interface, which remains light on interactivity like many streaming TV services? YouTube’s revamped smart TV experience would arguably be a better home. Thus, raising the question as to why the social platform did not capitalise on this opportunity with one of its biggest stars.

However, when thinking about content alone, the bet is less risky. The gap in production quality between social video streaming TV screen has narrowed. Each Mr Beast video costs upwards of $1 million to produce, with his challenge videos looking and feeling more like a reality show than a piece of social content. With AI video creator tools poised to narrow the production quality gap even further in the coming years, the transition from social video star to streaming TV celebrity is likely to become more commonplace. The Mr Beast deal comes after Prime Video backed Hazbin Hotel, the adult musical animation created by YouTuber Vivienne Medrano, also known as Vivziepop.

The advertising and subscription opportunity

So, why should Prime Video take such a gamble on Mr Beast? Unsurprisingly, the opportunity lies with advertising and subscriptions. For subscriptions, Mr Beast’s global popularity can be paired with Prime Video’s presence in 240 countries to encourage more people to sign up to an Amazon Prime subscription. Like all entertainment companies, engaging younger viewers to maintain the subscription funnel is key. How can Amazon persuade younger consumers using their parents Prime Video log in to pay for their own once they have enough disposable income? Keeping them in the Amazon ecosystem watching content and buying products will be key. Exclusive Mr Beast shows may help, especially if they are invested in the Mr Beast community and fear missing out.

Meanwhile, Prime Video has made a significant shift towards ads through its recently introduced advertising tier. While the move is predicted to generate significant revenue gains for Amazon’s already colossal $50 billion ad business, brands will still need persuading if they are to shift spend away from other platforms – a comfort Mr Beast can provide

The YouTuber has a track record of entertaining millions of viewers with his uncontroversial content that has delivered vast advertising income for YouTube. If Prime Video can get an advertiser through the door for Mr Beast, then they might stay for innovative techniques such as shoppable ads linked to products on Amazon.com.

For Amazon, more ad dollars, subscribers, and spend through the online store will be the benchmark for success when it comes to the Mr Beast deal. If successful, expect streaming TV services to deepen their relationships with content creators as a means of attracting younger consumers. Failure could prompt a reappraisal of streaming TV’s engagement with content creators. After all, if Mr Beast cannot make such a deal a success, then who can?