Last week, all sorts of news sites were discussing Netflix’s dramatic Q3 growth. Netflix added an additional 1.3 million subscribers, which in turn made them officially larger than their competitor HBO. Considering how dominant HBO has been in the commercial-free realm of box-office hit movies and original series, Netflix’s success is a big deal—although it really isn’t all that surprising.
Naturally, companies that provide similar products and services are shaking in their boots. The widespread belief is that Netflix will ultimately destroy mainstays like HBO, Showtime and Starz. There’s no doubting that Netflix will dominate the space for a while, but I feel like this is the opportune time for other companies to step up and learn by example. Let’s take a look at what made Netflix so successful—or better yet, let’s investigate what makes Netflix users fanatical.
In a nutshell, Netflix is:
a) A service that provides the latest movies and television programs, commercial-free. Along with movies and television shows from major studios, there’s a full library of independent films and documentaries.
b) Available on multiple devices. Users can access Netflix on a laptop, smartphone, gaming system, Wi-Fi-compatible television, Blu Ray player, Roku – the list goes on.
c) A low-cost alternative to cable.
So, for $8 a month, I can stream seven seasons of It’s Always Sunny in Philadelphia on my smartphone while lying in bed and stuffing my face with Cheetos? That sounds like a damn good deal! That’s way cheaper than the $100+ a month I’d pay for channels I don’t touch and can only watch through my television. Oh, and I can cancel at any time? w00t!
Remember: it’s okay to fail!
Although they’re not doing as well as Netflix, there’s still a tremendous amount of hope for HBO. Think about it: if it weren’t for programs and series from other cable networks, Netflix wouldn’t have much popular content to provide to members. HBO is still doing quite well because they’re producing exceptional programming; still, a slight dip in quality is enough to make anyone feel uncomfortable.
At this moment, the most important thing that HBO (or any other cable network) can do is listen to its audience. It’s often forgotten, but a little, non-existent sister company called Qwikster almost destroyed the now triumphant streaming giant. When their loyal customers expressed outrage, Netflix quickly called off the side project and focused on improving the services they already had (which is likely where the original programming came from). Clearly, it worked out.
Well, what about advertising agencies?
Well…what about advertising agencies? Back in 2008, before Netflix became known for their streaming services, people were already watching less television. Advertising and marketing agencies had to evolve to cater to Internet users. They heavily utilized rich media ads, display ads, sponsored content and so on. Advertising and marketing agencies figured out how to evolve then and they’ll just need to keep evolving. You may see a wider variety of YouTube ads, more sponsored content (similar to what you find on Buzzfeed), or heck; television may become so personalized and interactive that the ads served will target you specifically. Cisco certainly seems to think that will be the case.
Netflix is doing wonderful things for the general public. They’re providing extremely affordable, high quality entertainment to people of all ages. Netflix was not without its failures, but their shortcomings were learning experiences that made Netflix into what it is today. Perhaps the problem with television is that it’s been the same for a while. Back in 1999, TiVO revolutionized the way we watch television and now DVR is available with almost any cable package. 14 years later and nothing extraordinary has been invented.
Maybe the problem isn’t Netflix, but with cable companies being complacent. The fact that HBO subscribers need to also be cable subscribers also hold them back. Still, many companies have managed to make a big comeback, so there’s no reason to give up! Evolving your business requires work, but it’ll be worth it in the end.
What sorts of steps are you taking to help your business evolve? Let us know in the comments!