The GoPro Challenge
There are many who would believe that the GoPro strock is over valued driven by investors who see them more as a media company than a hardware manufacturer. So what have they been doing to repay the trust these investor have in their vision as being more than just a camera on the end of a stick?
They have invested in building a very usable platform for editing and sharing videos and the more people that share the more awareness of the brand. Despite the fact there is an enormous amount of content being loaded to social sites everyday filmed on a GoPro they would not be generating any revenue from this type of activity.
They have developed a number of marketing partnerships with athletes, celebrities, and entertainers from across the globe who all use their GoPro camera to generate even more content all of which is loaded onto the company’s video channel called the GoPro Network. Traffic to this channel has been growing although this does not seem to be translating to large revenues. In fact it is reported that media revenue is less than $2 million, not much if you consider their total turn over will exceed $500 million.
The challenge is going to be monetising the GoPro Network when the company is either giving the content away for free or relying on existing distribution partnerships such as YouTube who take a large piece of the revenue pie.
So If they do not realise the vision of building a media empire then the content will continue to be great for marketing, but ultimately not so good for their share price.