Hallmark Finally Joins the Streaming Wars

Over the last decade or so, as entertainment giants such as Disney and Warner Bros. Discovery dramatically downsized their cable businesses in a bid for streaming success, the folks at Hallmark Media did exactly the opposite. Instead of making fewer original series and movies for their linear channels, they made more. And rather than load up digital service Hallmark Movies Now with costly originals, they mostly kept it a home for library content that’s already aired on cable, essentially making streaming an afterthought at Hallmark. That’s about to change.

On Tuesday, September 10, HMN will transform into Hallmark+, and while the new service’s interface won’t look dramatically different, its mission will be a lot more ambitious. With the rebrand, Hallmark is making a significant new commitment to producing and platforming original content designed to premiere on streaming. In just the first four months of its existence, 18 new movies and six original series will roll out on Hallmark+, including Hallmark Media’s first-ever Christmas-focused scripted series (Holidazed and Mistletoe Murders); a Bachelor-style reality show designed to cast the next Hallmark hunk (Finding Mr. Christmas); and a lifestyle show starring Hallmark movie queen Lacey Chabert. There will also be several movie trilogies featuring popular Hallmark actors, including The Groomsmen, Love on the Danube, and The Jane Mysteries. And like HMN, Hallmark+ will continue to feature a large catalog of older movies from the cable channel, including a massive 600 hours of Christmas-movie content.

But while Hallmark is finally getting serious about building up its streaming business, company execs make it clear they have no plans to sharply reduce their cable offering in order to do so. “The linear business is extremely important to us,� says John Matts, chief operating officer of Hallmark Media. That means no shift to a “next day on Hallmark+� model the way Disney has done with FX, at least not in the foreseeable future. And when Hallmark announces its 2024 slate of Countdown to Christmas movies later this month, Hallmark’s two main linear networks will feature the same number of new movies on their lineup as they did last year, says Lisa Hamilton Daly, content chief at Hallmark Media. Hallmark+ is not designed as a replacement for linear, she argues, but simply “another way for us to find our viewers — people who love Hallmark that are maybe cord-cutters or never had cable.� (For cord-cutters who do want Hallmark linear content, the company continues to have a licensing deal with Peacock that offers a livestream of the company’s channels plus on-demand access to programming for a limited window.)

All this extra programming for Hallmark+ will come at a cost for current HMN subscribers: The monthly fee is going up $2 to $7.99; an annual subscription will cost $20 more, or $79.99. But in addition to a lot more first-run fare, signing up for Hallmark+ directly through the app or Hallmark website will also offer some new fringe retail benefits. Subscribers will be able to claim a free Hallmark card every month via Hallmark stores, plus a monthly $5 coupon for use in those stores, faster accumulation of Crown Rewards points, and unspecified annual-membership gifts. Unsurprisingly, Hallmark stores will begin pushing customers to sign up for Hallmark+ with a massive marketing campaign designed to turn shoppers into streamers.

Not rushing into the streaming wars ended up being a very smart decision by Hallmark execs, since it avoided accumulating millions in debt (as the bigger guys did) and kept its cable offering strong. Even now, Hallmark understands that the bulk of its audience is still watching cable. But while that linear content still delivers reasonably strong ratings (particularly relative to what’s left of its cable competition), the number of U.S. homes with cable continues to decline at a rapid clip. So at this point, keeping HMN as it was — and not getting serious about streaming originals — would have put Hallmark at risk of losing out on younger audiences who are into its programming but not interested in paying for a cable package (or Peacock). What’s more, Hallmark also has enough superfans that it can probably count on more than a few regular cable-viewers also shelling out for an offering that serves up even more of its Happily Ever After storytelling. Remember, this is a brand that sells its own wine, its own tea (hot or iced), and more than a few pairs of cozy Hallmark socks — all of which can be enjoyed at an in-person Hallmark Christmas Experience or during a stay at a Hallmark Holiday Suite by Hilton.

During a nearly hour-long conversation late last month, I asked Matts and Daly to explain the evolution of Hallmark Media’s streaming philosophy. We talked about what to expect from Hallmark+ over the next year or two, what it means for the cable-channel business, and how they plan to pay for all this new programming without running up a ton of red ink.

So you’ve technically had a subscription streaming service for a while with Hallmark Movies Now, but from my vantage point, it really didn’t feel like you were super serious about the space until maybe the last year or two. How would you describe HMN’s place in the Hallmark universe? 

John Matts: When you look at what it was when I walked in the door — it was a library service to just get our content out there and make some money on the side. We weren’t really thinking about how to program that separately or differently.

Lisa Hamilton Daly: There was nothing new on it. And in a lot of cases, we were carrying content from other places — a lot of licensed content in addition to our own content.

Has HMN gotten much traction with audiences? How many subscribers does it have? 

J.M.: We don’t release numbers. We’re not a public company. But I was surprised at the size and the number of folks who wanted to have a library-content service just to have access to our movies. It was bigger than you would have expected, frankly. It showed us that there’s an audience there willing to get in even when we’re not putting new content out there.

I remember talking to you last year, Lisa, and you were already starting to hint that changes were coming to HMN. And sure enough,  I started noticing a few Hallmark movies would actually premiere exclusively on HMN before landing on the linear channel a few months later. So was this something you were doing on purpose, to sort of test out what happened when you offered exclusive programming for streaming?

L.H.D.: It was definitely intentional. We were trying to see, if we put something on HMN, what does it do to our linear viewership? We were really thinking about how we would be unrolling content across the two platforms. And it was sort of a series of experiments to figure out what the best content strategy was vis-à-vis both services.

What sort of questions were you trying to answer with these experiments? 

J.M.: We’ve been thinking about what programming lives better on a linear- first format and what works best on an SVOD- first or SVOD-only type format — and can we create value in both of those places with two really compelling products, all leveraging the Hallmark programming that Lisa’s putting out.

And what did you discover?

L.H.D.: When we premiered some of our linear content on SVOD first, the viewership we got was very robust. We hope that bodes well for when we launch Hallmark+. I think people are going to be excited about all the exclusive content we’re going to have over there.

You’ve announced a lot of interesting stuff, including some things that were actually filmed a year or two ago, like the series Holidazed. Were these projects you were planning for Hallmark Channel but then decided to move to streaming? Or had they been green-lit with the thinking that you’d be changing streaming strategies and would need more programming?

L.H.D.: We were definitely aiming for a relaunch of the streaming service. The idea was that a streaming service could support more series because series content is really doing well on streaming. We think streaming is where people are going to come for that. We’re kicking off on September 10 with The Chicken Sisters, which is an eight-part series that we’re doing based on a Reese Witherspoon book-club book. It is adorable. I think people are going to love it. We then will have some unscripted series that are going to be debuting, too. Unscripted is a really interesting avenue for us to look for new ways to think about the Hallmark brand and how it can live through different types of entertainment.

You have a lot of original programming debuting during the first few months of Hallmark+ — six original series and 18 movies. Is that pace going to continue once we get into 2025? Do you want to have something original premiering almost every week? And how many original movies should subscribers expect?

L.H.D.: We’re looking to have a fairly similar cadence throughout the year. The idea is to have at least three new H+ Original movies every month.

What about the user experience on Hallmark+? Will it be dramatically different from what Hallmark Movies Now is right now? A few months ago, I noticed you had quietly redesigned the app a little bit.

J.M.: We’ve definitely made some usability improvements. I would call the Hallmark+ launch a rebrand and a refresh of the interface. It’s not going to look completely new; it’s going to feel similar. But it’s going to be smarter and it’s going to work better and be easier to use. It’ll do a better job of serving up content that you tend to enjoy. It will feel like Hallmark Movies Now, but a much fresher version.

When I look at what sorts of programming you’ve announced so far for Hallmark+, a lot of it feels like it could easily fit it on the main channel. And as you’ve said, you’re making quite a bit of it, which even on your rather efficient economic model, isn’t cheap. Is your plan to recoup some of your investment in streaming by monetizing that programming on your main channels down the road?

J.M.: We are going to test and learn as we go, but we definitely see the value of, “Hey, let’s release this stuff and give it a first window on SVOD, give it a good runway, and then think about a second window back on linear.� You could see some of the series we’re doing window back within six months or eight months. You could see some movies window back in six to 12 months. There could also be shows like the reality programs we’re doing that stay exclusive to Hallmark+.

So that would mean everything you’re spending on Hallmark+ isn’t a completely new investment, because it is also an investment in Hallmark’s linear programming?

J.M.: Yeah — they both benefit from this. We’ve had some really successful series in the past. I couldn’t afford to program a linear channel with the number of series that I’m able to make across both platforms now. So linear gets to benefit from those series that we’re producing on the SVOD side by getting content it never would have had in the past. It sort of raises all boats once we do this and we do it right.

But the windows will not be super short, right? Will 2024 holiday shows like Holidazed and Mistletoe Murders air on Hallmark Channel this year?

L.H.D.: They will not.

But it’s possible they could air on the linear channel next year? 

L.H.D.: Yes.

I ask about that because, up until now, you’ve been very careful to work with your cable-company partners to make sure they feel that Hallmark Movies Now is a complement to the main channel and not a competitor. How much is that going to evolve now with Hallmark+? How do you make sure you balance things out so that you don’t risk those license fees the cable companies pay you? 

J.M.: Unlike some other folks out there, we’ve continued to program at the same levels. We’ve always programmed on linear. And our intention is to continue to do that well into the future because that is a great business for us. That’s how our audience likes to consume our content. So we spend a lot of time thinking about how we maintain value for our customers who are linear subscribers, and also for our partners and distributors who are out there selling cable packages. We don’t want to be the ones who bring the bundle down because we’re not programming anymore. The linear business is extremely important to us and we’re going to continue to lean into it.

So one thing that’s different about Hallmark+ versus most streamers is that there are some non-streaming perks that come with the membership. Are people going to get those benefits if they sign up through the Amazon, Apple, or Roku channel stores?

J.M.: If you go through a channels store, you don’t get access to all the Hallmark features that we’ve created as part of Hallmark+ — the discounts in our Gold Crown stores, the free cards that we’re making available. All the things that are available to consumers of Hallmark+ through Hallmark aren’t available through a channels customer. If you’re a big, hard-core Hallmark fan, we want you to come into our universe. But we understand that there’s value elsewhere in those channels stores, and those are great partners for us. They’re able to reach audiences we can’t.

I remember there being talk before Disney+ launched of them offering a bunch of non-streaming benefits to subscribers. They’ve done some experimentation with that, but it’s not really part of the core offering like what you’re doing with Hallmark+. What sort of advantage do you think your streamer has because of its connection to the larger Hallmark retail universe. 

J.M.: When you look at the Hallmark retail side of our business, we have one of the oldest membership-rewards programs, I think, in the country with data going back 20 or 30 years. We see how consumers act when they’re in our stores; we know what they like and we know what they want. And that core group of retail customers overlaps almost exactly with the folks that like to watch the programming that Lisa and her team are making. So we could see the value that was possible to be added by creating Hallmark+. I mean, to your point, I do think that bigger companies that are more disparate and spread out have a harder time being able to pull this off, and we’re in a unique position to be able to do that. We know our customer group so very well that we can make a compelling case: “Here to go out and get this, even if you are a cable subscriber.�

And your retail stores are going to be a big part of the marketing push for Hallmark+, right? I read that customers at the stores will find promotional materials for the service in their shopping bags, including a QR code that unlocks a free trial of the service. 

J.M.: You’re going to see things in the store — installations, posters, some life-size cutouts of some of our stars. But it’s really going to be about telling consumers, “Hey, there’s this really exciting thing that we can offer.�  We’ve trained our store employees to understand what it is and how it works and be able to explain it to their customers. And we’re not just pushing a streaming service on them. We’re pushing this lifestyle brand and these other benefits that matter to the people that come into the stores.  You’re going to see quite a bit of that synergy between what we’re doing in stores and what we’re selling with Hallmark+.

I hope you’re giving those store employees Hallmark+ for free.

J.M.: We are!

So what does success look like for Hallmark+? And what is the goal in terms of subscriber growth versus Hallmark Movies Now? 

J.M.: It’s going to be way bigger than it is now. That’s the expectation. [Laughs.] No, I mean, listen: If you think about what we’ve been able to do with just a library service, I think we can get to doubling our subscribers in a fairly short time frame. Within a couple of years, we should be double where we are now, and then continued growth into the foreseeable future. We’ve seen that there’s a sizable audience and there’s a lot of people interested in viewing and consuming our content, not to mention when you layer in all of the great things you get from Hallmark with our service. We think we can grow pretty quickly, and we have pretty good expectations that I think are reasonable and achievable.

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