The world today tends to watch entertainment content such as movies, videos, and TV shows in the form of online streaming (stream) more than DVD, CD... as in previous years. With a library of more than 3,781 movie titles, 1940 series and TV shows, Netflix is currently the market leader in providing digital content online. In the US alone in 2016, more than 51% of the country's population watched entertainment content through Netflix. Another statistic shows that the total paid Netflix users in the third quarter of 2020 reached 195 million people worldwide, surpassing other potential competitors such as Amazon (150 million), Disney+ (60.5 million), Hulu (35.3 million). In a recent financial report of Netflix, total revenue this quarter reached 6.44 billion USD, 20% higher than the same period last year.
Statistics on the number of Netflix paying users in the third quarter of 2020
So, where is the key to Netflix's success? Is it because of the massive content store or because Netflix grasped the technology trend earlier than other competitors?
Netflix focuses on video quality instead of quantity. Netflix's content store is much, but still less than many other competitors. As mentioned in the opening paragraph, Netflix's content store has a total of 3781 movie titles, 1940 series and TV shows (according to the statistics of the third quarter of 2020). This number is still lower than many other competitors, typically Amazon Prime Video with 184,000 movies and 2220 TV shows.
Capturing technology trends is just a stepping stone for future development. In the beginning when it was founded, Netflix was just a small video rental company, much smaller in size than the big names of the time like Blockbuster. However, after a period of operation, Netflix has noticed changes in the micro and macro environment, namely the technology environment and consumer behavior trends. By taking advantage of the growth and growing popularity of the Internet and related technologies, Netflix has made the decision to gradually shift its business model to streaming content. ). This is the stepping stone for the resounding success of Netflix later.
Blockbuster - đối thủ cạnh tranh lớn với Netflix đã từng tồn tại
In-depth research and analysis on the business environment and customer behavior is the key to Netflix's door to success.
For Netflix to be able to provide videos with content that are of great interest to users, as well as make a turning point in business model transformation, is thanks to Netflix's good job of observing, researching, and analyzing Analyze consumer behavior and business environment. Maybe few of us suspect that, when users watch videos on Netflix, it is also the time when Netflix monitors and observes our behavior and usage habits to get reliable data from there. search keywords, played videos, watch time on each video, number of times and rating scale...) for Marketing. Thanks to that regularly aggregated data store, Netflix can know what content each individual user wants to watch, thereby displaying personalized recommended videos on the interactive interface, contributing to keeping user retention as well as attracting new users.
Based on the research results, Netflix builds a recommended video system and optimal display for each user
Not only stopping at the role of an intermediary to provide and filter videos for users, Netflix also takes advantage of the collected data to produce and provide exclusive content. Most of the works made by Netflix have brought great success, typically Stranger Things (2016) and The Witcher (2019). In 2018 alone, Netflix was nominated for 112 Emmy Awards, breaking the monopoly of HBO for 17 years. Besides, in the Oscar ceremony of the past year (2019), the total number of nominations for Netflix movies was 24.
2 among the most prominent titles produced by Netflix: The Witcher and Stranger Things
The stage of expanding the market from the US to other countries of Netflix is also very methodical based on the results of the research. Quasi Experiment - Incomplete experiment - is a research method applied mainly in Netflix's expansion, when the business will conduct many tests in a new national market, before launching decide whether the country is an open land to do business or not.
The chart of countries with the appearance of Netflix - According to the statista page
Netflix also regularly conducts surveys to optimize the user interface. By allowing a small number of users to access with the new interface, while the rest use the old interface (A/B testing), Netflix has a solid basis on which to judge whether to switch to using the old interface. use the new interface, or whether to make any adjustments or optimizations.
Smart employee management methods also contribute significantly to the success of Netflix, but hocmarketing.org will cover this aspect in more detail in later articles.
In an interview, a representative of Netflix said: "We are committed to being the best service for customers, a reputable partner of suppliers, and a stable source of profits for investors. investment, and a mesmerizing influence on employees". With all that Netflix is having, the above commitments are completely possible.