Executive Summary
Cameo is an online service that facilitates connections between celebrities and their fans. People can hire celebrities– ranging from sports personalities to tv and film stars to music artists– to create personalized videos. Cameos are available online and in-app, running from as low as $1 to as high as $15,000, depending on the celebrity. Alongside celebrity video messages, the company also offers short video conversations called “Cameo Calls,” which digitizes the traditional meet-and-greet format.
The service gained considerable traction in the entertainment mainstream as a clever and innovative way of gifting social interactions. However, it was not until the COVID-19 pandemic that it exploded into the limelight. Celebrities and fans alike found themselves bored and isolated in their homes, seeking human interaction and connection. This mutual idleness resulted in a surge of video requests and creations, cementing Cameo’s position as a profitable and culturally relevant entertainment technology company. However, it is not the only celebrity video messaging site on the market, and life is slowly emerging out of a quarantine mentality. Therefore, Cameo will need to continue expanding its technologies and features to enable more innovative and sustainable ways to monetize social interactions between celebrities and their fans.
Socially, one of the most significant drawbacks for the company is its lack of community and communication channels. Cameo’s CEO and founder, Steven Galanis, shared his desire to evolve the site into a “social network” that enables user experiences similar to other video-forward social media channels like TikTok and Instagram (“Cameo CEO Steven Galanis”). This vision depends on a shift in the company’s game plan: at the moment, consumer experiences with the site are touch-and-go– a fan hires a celebrity to make a video and then shares it across networks outside of the Cameo universe. There needs to be a substantial and concentrated effort to develop new features for the website and app that connect consumers to the context around them, using other social media platforms as a guideline for what works. Such features include public feeds where individuals can share their videos and see what others share, celebrity chat boxes, and geo-locations to find local celebrities.
Economically, Cameo’s direct-to-fan (D2F) business model proved highly profitable and appealing to celebrities on the service. However, suppose the company wants to become a social media-esque platform that excludes advertisements from its revenue stream. In that case, it will need to augment its revenue options beyond the 25% commission they draw from fan-requested video messages. Cameo for Business was introduced to supplement Cameo’s consumer-limited profit. The few already-successful commercial projects held in conjunction with the site prove that this feature is vital for long-term sustainability and success.
Company Background
In 2017, Steven Galanis founded Cameo as a bridge to facilitate more intimate and meaningful interactions between celebrities and their fans. It is essentially a booking service, available on iOs, Android, and the web, for people to connect with various talents in the entertainment industry, from D- to A-list names. Customers pay to receive personalized video messages from their favorite celebrities. The site boasts a diverse profile of over 40,000 personalities to wish fans a happy birthday, give them words of encouragement, or even roast them on someone else’s behalf. Cameo’s origin story is a bit sour– the internet called the first celebrity to make an (unofficial) Cameo a cheap sell-out– but that conflict was a critical turning point for the company. Galanis expertly rebranded Cameo to celebrities as a connection-first, money-second platform, where the primary purpose was fostering deeper relationships with fans and cementing them into your fandom. Additionally, the talent drives their own demand, bringing fans and awareness to the site.
In 2020, Cameo reached a milestone of 2 million downloads, 1.3 million Cameos, and $100 million in sales (Scipioni). It is notable to mention that 75% of that revenue went to Cameo talent. This year, the Chicago-based company’s popularity and profit soared, with over 2.55 million website visitors and over 140k downloads per month, and projected annual revenue of $2.5 million (zap). While it might seem like the company is taking a severe nosedive, it’s crucial to remember that 2020 was the year of the COVID-19 pandemic.
Celebrities and fans alike found themselves stuck in their homes, isolated and bored. Additionally, quarantine disrupted traditional business models supporting talent across entertainment ecosystems, which meant that many celebrities needed the Cameo revenue stream. This disruption brought unprecedented awareness and adoption of “direct-to-fan models,” planting new foundations for fan engagement (Heater). These factors lent themselves to Cameo’s significant boost in attention and sales.
Alongside customized video messages, Cameo has been testing two other fan-engagement features: Cameo Direct, a variation of live-chat chatting with celebrities, Cameo Calls, a live, one-on-one video call between fans and talent, and Fan Clubs, an iteration of VIP fanship (Spangler & Hatmaker). These features reflect the company’s initiative to make the service more viable and sustainable to celebrities and more socialized and networked (open communication channels). Cameo also offers Cameos for Business (C4B), where brands can license a celebrity’s content for use in a marketing campaign. This opportunity not only augments artists’ potential revenue stream since commercial licenses for videos will cost more than videos reserved for noncommercial use, but it also connects businesses to talent through a frictionless communication experience. Cameo wants to direct the platform into a space with a “higher frequency of engagement;” these additional features are a solid starting point (qt in Ifeanyi).
State of the Industry
Competitive Landscape
Before Cameo, there existed Greetzly (2014), CelebrityVM (2013), and Starsona (2017). While these companies are not direct competitors, as they have nowhere near the influence, star power, or technological infrastructure as Cameo, they essentially provide the similar service of celebrity-fan connection. Perhaps it’s better software and creator visioning that make or break a technology-centered company, but the fact of the matter is that Cameo is dominating this niche industry of monetized celebrity-fan interactions. The company should not be complacent since technology giants are constantly looking for new ventures to add to their metaverse.
Facebook stands at the forefront of ‘taking inspiration’ from various tech competitors. In 2020, the company announced it was building a product to enable users to pay content creators or celebrities to interact with them during a live broadcast (Wagner). This tool, titled Super, replicates Cameo’s digital connectivity on a broader scale, facilitating open communication channels between celebrities and fans that place the latter in closer proximity to the creator even though the basis of the whole interaction is not uniquely fan-driven. Facebook’s New Product Experimentation team launched a live test version of the app earlier this year, a new and daunting challenger within Cameo’s industry niche.
The purpose of Super is to simultaneously enable high-profile interactions and causal video messages– like Cameo (Hutchinson). By combining the increasingly social gift economy model with an eCommerce marketplace, Facebook’s product allows a form of reciprocity that Cameo technology does not yet support. However, this shortcoming is not only top-of-mind of Galanis’ mind but mitigated by his company's avoidance of data dependence and monetization. He aspires to evolve Cameo into a social network, and he recognizes that work would entail adding more “social components” to the app. Nevertheless, he emphasizes the importance of ditching a traditional advertising revenue model, discerning that data selling is a point of anxiety and vexation for many social media users. While Facebook’s celebrity interactions might come at a slightly more accessible price point for higher-tier talent– this is speculation given the potential cost offsetting by ads and that Facebook has not released any pricing– Galanis believes that people would rather “pay a premium to have bespoke content for them” than partake in a general fan meeting with a celebrity (“Cameo CEO Steven Galanis”).
Another imminent player is TikTok, which appears to be testing an in-house Cameo competitor called “TikTok Shoutouts” (Hale). This new feature offers a financial opportunity for creators, one that Cameo has already proven to be highly successful: users can request a personalized video or 'Shoutout' from their favorite in-app creator. TikTok is at the heart of the creator economy, providing many tools to help creative individuals build their brand and monetize it. Therefore, it is no surprise that the entertainment technology company would want to tap into Cameo’s market. Shoutouts is a relatively new development in a well-established social space, so Cameo must remain contemporary and innovative with its value proposition to distinguish itself from these tech giants.
Technology’s Impact
Cameo would not exist without technological innovation. As a champion of eCommerce transactions and the “digital [video] selfie,” the company relies heavily on software to keep the app running smoothly, eCommerce technology to ensure transactions happen securely and accurately, and video formatting to create the messages in the first place. For the latter technology, Cameo owes much of its existence to Snapchat because it pioneered the selfie video format (“Cameo CEO… social media company”). Cameo built and sustained an entire company dedicated to this relatively new form of socialization by harnessing and adopting the emerging technology right away.
That is to say that phone cameras were nothing new when Cameo launched; they were already well-built into social media platforms. More video-focused platforms such as Dubsmash (2014) and Musical.ly (2014) were also riding this consumer-to-creator wave. This technology enabled a surge of images filtering into our daily lives, which helped breed what we know today as the attention economy– a new paradigm centered around instant creation and reaction (Acton). While this shift in consumer behavior forced many entertainment technology companies to rethink their UX, Cameo entered the game already understanding the field and player dynamics. It developed a scalable business that capitalized on already established, technology-driven behaviors. Now, not only are video selfies a cultural mainstay, but with the right star-powered touch, they are emblematic of delivering instant, compelling content that warrants an equally instant and engaging response.
Business Strategy
Cameo’s first and obvious challenge was convincing celebrities to join a platform that valued authentic relationships over maximized profit. Galanis recognized that, before his company, the other celebrity video messaging services failed because they offered A-list celebrities’ time at an incredibly high and inaccessible price point. Those companies– and stars– were disconnected from their audience's financial and social circumstances. To give Cameo a chance to penetrate the entertainment technology industry, Galanis sold the first Cameos for $1 and $3. Galanis explained that the low price points would “build liquidity in the marketplace” so that the company could eventually scale up (“Cameo CEO Steven Galanis”). Of course, it was not B-list or even C-list celebrities offered at this time, but micro-talent such as Cameo co-founder Devon Townsend ($1) and co-founder and YouTuber Cody Ko ($3). Soon after, their Instagram direct messages had blown up from people who loved the content. Eventually, enough celebrities recognized the opportunity and sustainability of nurturing fan relationships through mediated content and joined.
Cameo takes a relatively hands-off approach when getting talent situated on the site. Celebrities can set their prices for personalized videos and accept or deny video requests. Cameo prices range from as low as $1 to as high as $15,000, with former boxer Floyd Mayweather proudly holding the latter price point. The company only takes a 25% commission fee from each transaction made through the website. In comparison, Cameo products requested through the iOS app encounter a 55% total fee (30% to Apple and 25% to Cameo)– luckily for creators, the majority of people turn to Cameo’s website for their bookings (“What percentage do I earn”). Galanis wants to build Cameo into a “marketplace for people’s time,” where fan behavior and celebrity obsession drives a new revenue stream for a whole spectrum of celebrities, from B-list to D-list celebrities, microcelebrities, nano-influencers, and more. For Galanis, the company’s number one KPI is the number of Cameos created, answering how many people are building connections (Ifeanyi). The features added to the platform, the talent included, and the overall messaging on the site reflect the company’s goal to “create the most personalized and authentic fan connections on Earth” (qt. in Spangler).
Currently, Cameo pulls its revenue primarily from the 25% commission fee. It prides itself on avoiding an ad-supported business model, typically the standard for social media platforms– Cameo functions solely off a transactional business model. Despite their break from tradition, many investors are not deterred and believe in the viability of a celebrity-powered, transaction-only revenue system. In its most recent funding round, Cameo raised $100 million Series C from new investors like SoftBank Group Corp Vision Fund, pro-skateboarder Tony Hawk, and Alphabet Inc.– its valuation shot up to $1 billion. Since 2017, Cameo went from zero bookings to one hundred million (Scipioni). This funding will help Cameo “define the future of the ‘connection economy’ on a global scale,” as it works at the intersection of accessibility and entrepreneurship (Heater).
Future Implications & Analysis
While Cameo has a solid domestic base of fans and celebrities, it lacks a robust global market. With many international artists entering the Western pop-culture mainstream, such as K-pop artists and European soccer stars, Cameo must be present in that space to meet them. Galanis estimates that less than 5% of talent on the site is based outside the U.S., while nearly 30% of all bookings come from people from other parts of the world (Ifeanyi). The customer demand overseas does not reflect the number of celebrities acquired overseas. Though this disconnect does not affect supply and demand directly, there are implications for demand constraints. The global market is incredibly underserved in Western exposure and monetization, but it is an opportunity that could grow the company exponentially. Foreign film and television shows are ranking high on streaming services, and international music artists are quickly cementing influential fandoms across the globe. Cameo is already working on expanding its international offering beyond the 20% of videos currently purchased outside the U.S., but global amplification needs to be the company’s main priority.
Cameo also aims to connect fans with celebrities that are non-human, non-living, or not of this reality. The company’s Chief Business Officer Arthur Leopold notes a viable market for people wanting video messages from animals, like the Cincinnati Zoo’s Fiona the Hippo, or even robots, like Sophia the Robot. Of course, some of the largest fandoms spawn out of fictional universes, which the platform wants to leverage. Several months ago, Cameo entered a tentative partnership with Mattel to bring the latter’s intellectual property to life in a new, innovative way and make it more accessible and personal to people (Canton). Mattel played a fundamental role in pop culture, with many beloved characters under its belt, and this collaboration would unlock a new facet of its IP. In the same vein, Cameo vivifies Thomas the Tank Engine Cameo through conversational AI. The technology will construct messages to fans based on stored conversations and scripts of the character’s voice. Since there does not need to be a human component in both cases, Cameo videos for Barbie or Thomas are limitless and grant a “scalable and major revenue opportunity for IP holders” (Canton).
Lastly, Cameo needs to build technologies and features that foster a sense of community on the platform. The social space Galanis wants to bring his company is already crowded. To avoid becoming a kind of “passing trend,” Cameo needs to focus on building a platform that initiates a “higher frequency of engagement,” which necessarily opens communication channels to be two-way instead of one-sided (qt. in Ifeanyi). A content platform ecosystem will emerge when stories can be disseminated and viewed across the community, evoking compelling and engaged responses. This interactivity will entice users to revisit and potentially rebuy the service, as there is an added layer of authenticity and connection excluded when one party’s communication channel is blocked.
Cameo needs to keep facilitating these relationships and utilizing technology to broaden the possibilities for fan connection if they want to remain at the forefront of the entertainment technology market, making celebrities accessible and personable. We live in an ever-changing technology landscape, and the only way to stay relevant is to adapt to the change. Suppose Cameo can accommodate an expansion of the global entertainment market and extend its talent supply beyond human limitations. In that case, they are poised to continue dominating this niche industry– even with Facebook and TikTok barking at their heels.
Works Cited
Acton, Annabel. “The Video Selfie Has Arrived and It's Disrupting Communication.” Forbes, Forbes Magazine, 7 June 2017, https://www.forbes.com/sites/annabelacton/2017/06/07/the-video-selfie-has-arrived-and-its-disrupting-content-and-communication/?sh=3982fa413e18.
“Cameo CEO Steven Galanis on Building the First Non-Advertising Driven Social Media Company: Acquired Podcast.” History and Strategy | Deep Podcast Case Studies, 5 Jan. 2021, https://www.acquired.fm/episodes/cameo-ceo-steven-galanis-on-building-the-first-non-advertising-driven-social-media-company.
Canton, Rafael. “Thomas the Tank Engine Fans Can Now Get Personalized Cameos.” Adweek, Adweek, 16 Nov. 2021, https://www.adweek.com/brand-marketing/cameo-mattel-thomas-tank-engine-connect-fans/.
Hale, James. “TikTok May Be Testing an in-House Cameo Competitor Called 'Shoutouts'.” Tubefilter, 5 July 2021, https://www.tubefilter.com/2021/07/05/tiktok-cameo-competitor-shoutouts/.
Hatmaker, Taylor. “Cameo Buys Fan Merch Platform Represent.” TechCrunch, TechCrunch, 25 Oct. 2021, https://techcrunch.com/2021/10/25/cameo-represent-acquisition/.
Heater, Brian. “Celebrity Video Request Site Cameo Reaches Unicorn Status with $100m Raise.” TechCrunch, TechCrunch, 30 Mar. 2021, https://techcrunch.com/2021/03/30/celebrity-video-request-site-cameo-reaches-unicorn-status-with-100m-raise/.
Hutchinson, Andrew. “Facebook Launches Initial Test of Its Cameo-like Celebrity Video App 'Super'.” Social Media Today, 17 Feb. 2021, https://www.socialmediatoday.com/news/facebook-launches-initial-test-of-its-cameo-like-celebrity-video-app-super/595254/.
Ifeanyi, KC. “How Celebrity Shout-out Startup Cameo Is Trying to Turn Its 15 Minutes into Full-Fledged Stardom.” Fast Company, Fast Company, 19 Aug. 2019, https://www.fastcompany.com/90389278/how-celebrity-shout-out-startup-cameo-is-trying-to-turn-its-15-minutes-into-full-fledged-stardom.
Scipioni, Jade. “Cameo CEO Steven Galanis on Building a $1 Billion Start-up: 'I'm Doing This for First Time'.” CNBC, CNBC, 20 May 2021, https://www.cnbc.com/2021/04/06/cameo-ceo-steven-galanis-on-building-a-1-billion-start-up.html.
Spangler, Todd. “How Cameo Generated $100 Million Last Year from Celebrity Shout-Out Videos.” Variety, Variety, 31 Mar. 2021, https://variety.com/2021/digital/news/cameo-steven-galanis-celebrity-videos-1234908473/.
Wagner, Kurt. “Facebook Building Cameo-Inspired Tool to Let Fans Pay Celebrities for Face Time.” Bloomberg.com, Bloomberg, 15 Dec. 2020, https://www.bloomberg.com/news/articles/2020-12-15/facebook-building-tool-to-let-fans-pay-celebrities-for-face-time?utm_content=buffera517b&utm_medium=social&utm_source=twitter&utm_campaign=buffer.
“What Percentage Do I Earn from Each Completed Cameo Video ...” Cameo, https://help.cameo.com/hc/en-us/articles/4407237929492-What-percentage-do-I-earn-from-each-completed-Cameo-Video-.
Zap. “10 Alternatives to Cameo App: Competitors and Similar Apps.” Outsource IT Today 🎯, 21 Oct. 2021, https://outsourceit.today/5-alternative-to-cameo-app/.
コメント