Netflix has become a worldwide giant of online – and offline – streaming, reaching a turnover of 2.99 billion dollars and a total of 109 million subscribers. Incredible numbers that will continue to amaze, as they grow from year to year and seem to be unstoppable. In the last year, Netflix has obtained 5.3 million new subscribers, of which 850,000 from the USA and 4.45 million from the rest of the world. Currently, in fact, it has managed to spread globally, thus covering more than 190 countries.
Since 2015 it has also arrived in Italy, but the data relating to Italian subscribers have not been made public. Netflix shows global results quarterly, highlighting only those of the United States compared to those of the rest of the world.
In the past few weeks, Netflix has decided to increase subscription prices, from € 9.99 to € 10.99 for the Standard subscription, and from € 12.99 to € 13.99 for the Premium subscription.
How do you explain Netflix’s exponential growth? Will the price increase of around 10% affect the growth rate? Is the Netflix brand a viable alternative to Sky, Timvision, Infinity, etc.? To answer these questions it is good to consider the following.
Netflix makes us feel part of a community – Tribal Marketing
Tribal marketing is a market strategy that aims to identify and support a community around a good or service from a particular company. It differs from classic marketing, where there is mainly a company-customer relationship. In tribal marketing, the aim is to create customer – customer relationships. The most famous cases studied in the marketing books are those of Harley-Davidson, Jeep, and Apple, brands that have managed to create such a strong interest in the products of their company, to build real tribes of people united by the passion for the same product/brand.
Netflix, however, is no exception. We remember the Sense8 case, a TV series published on Netflix from 2015 and canceled in mid-2017, at the end of the second season. Following this decision, thousands of fans protested, through petitions and social campaigns, managing to make Netflix executives change course. After less than a month, producer Lana Wachowski announced a two-hour special episode, due out in 2018. All Netflix users (the community, in fact) was able to change the cards on the table, convincing the company to return to its decisions. When a product becomes a “witness”, or a tool that holds the community of enthusiasts together, you gain in solidity and business development, but you have to deal with the needs and expectations of customers, perhaps even more than traditional businesses. And this seems the challenge that Netflix seems to have accepted and on which it bases its growth strategy.
Brand Engagement, through Content Marketing
Content Marketing is a type of web marketing with which companies create and share online content, aimed at acquiring and maintaining customers. The main purpose of the company is not to sell a good or service to the customer, but to inform him about a specific fact or topic. The contents are in fact illustrative/informative and, through them, the aim is to attract the consumer. The ultimate goal is to increase the reputation of a company, which requires ensuring high quality and reliability of the content itself.
Netflix’s social media managers have perfectly understood the importance of this type of marketing. The most striking case is that of the Stranger Things series, released for the first time in July 2016. It immediately achieved amazing success, receiving very positive reactions from both critics and the public. From then on, until the arrival of the second season (end of October 2017), Netflix’s Facebook page has published hundreds and hundreds of references to ST. The day before the release of the second season, they instead published a video in which one of the main actors of the series was ironic about the strike of those days, which happened in Milan. In the video, the viewer was left to believe that the real cause of the closure of the subway was the presence of the “Demogorgon”, the antagonist monster of the series, and not the strike. These moves are aimed at creating brand engagement, that is, the search for an emotional and cognitive relationship with the brand, which can last over time. In fact, the reactions to this marketing tool, as far as Netflix is concerned, seem to have been positive and effective.
It has an unrivaled offer: market leader, offline streaming and large catalog
Currently, the Netflix Italia catalog boasts more than 2700 contents, including films, TV series, documentaries and content for children. The ability to be able to watch them at any time and from any device, at a relatively low price, are factors that, today, have proved successful. SkyGo, Infinity, and TimVision don’t reach Netflix numbers. For this reason, Netflix represents the leading platform in the Italian market. And in recent years it also seems to have managed to decrease illegal streaming.
Furthermore, it is likely that one of the reasons why many people prefer it to traditional television is the lack of commercial interruption. If we also add the fact that the interface is simple and easy to use and that it has been possible to take advantage of the offline streaming service for a few months, then it seems much more intuitive how it managed to reach such a large number of subscribers.