With the global epidemic, home entertainment is particularly important. Netflix streaming company offers a vast inventory of movies and TV on demand. Netflix has grown substantially since the 2020 epidemic, adding 16 million subscribers.
As a leading company in the streaming industry, the reasons for Netflix’s success are worth analysing. This paper analyses Netflix’s promotional strategy, success stories and experiences and identifies problematic areas for advice.
The study finds that Netflix’s promotional strategy is related to social media, which is used to increase interaction with viewers, such as the case of Netflix’s successful entry into the Spanish market using Twitter. The disruption of the business model and the creation of a recommendation system enhance the user experience.
The development of original content attracts new subscribers through innovation, as in the case of Black Mirror, which created a new interactive model.
At the same time, a number of problems have been identified, such as the limitations of Netflix’s international development, the dependence of revenues on subscriptions and the high cost of producing original content. Keywords: Netflix; marketing strategy; social media.
The closure of cinemas and numerous entertainment facilities during the pandemic shutdown made streaming services popular
1. Netflix still has a market when streaming entertainment facilities during the pandemic, with the average person spending one hour and 11 minutes per day on the streaming platform during the shutdown, according to research
2. Netflix is an American video subscription on-demand streaming platform. To date, Netflix has 208 million paying subscribers worldwide, 74 million of which are in the United platforms are blossoming. Therefore for a study of the streaming industry, Netflix is a good choice for a success story. The main feature of Netflix is that it allows users to watch content over the internet whenever and wherever they want, which allows them to watch videos without restrictions. According to research, 361,000 subscribers are known to have posted and watched the second season of The Odd Couple in one sitting
3. This binge-watching social situation has become even worse in the wake of the new coronavirus pandemic. Netflix was the preferred streaming platform for US households during the pandemic, accounting for 34% of US households’ choice of streaming media according to the survey
4. 46% of UK adults surveyed cited Netflix as their streaming platform of choice
5. The popularity of Netflix is evident. The success of Netflix in the streaming industry is worthy of study and reflection. In terms of business strategy, Netflix’s success is linked to the innovation of its business model, which was originally a traditional DVD rental sales model and then shifted to a streaming service. Netflix established a profitable model regarding paid
Founded in 1997 by Reed Hastings and Marc Randolph in California, Netflix now has 222 million subscribers worldwide.
Initially, Netflix was not the on-demand model it is today. Netflix started out in 1997 as a traditional pay-per-view DVD rental service with a mail-in service, and in 1999 the company switched from a rental DVD model to a subscription model where customers pay a monthly fee for unlimited DVD rentals, turning the traditional model on its head and taking a distant second place to the then most famous BLOCKBUSTER video rental chain.
But the most innovative and embryonic move of the current company model came in 2007 when Netflix launched a subscriptionbased streaming and video-on-demand service. Netflix was the first innovator to launch such a service [8]. In the beginning, there were only 1,000 movies available on the Internet for video-on-demand and 70,000 DVDs until the mid-2000s, when increased data speeds and lower broadband prices allowed Netflix to offer movies online.
Netflix redefined the industry’s value proposition, from DVD rentals to offering wireless access services, and subsequently began to offer original content offerings [8]. Netflix developed the film and television industry production in 2013 with the launch of its first series House of Cards adapted from the BBC’s award-winning TV series House of Cards [9]. The original series Women in Prison aired on Netflix and became the highest-rated original series. Netflix’s popularity has even seen a trend of ‘binge-watching’, defined as the desire to quickly watch multiple episodes on DVD or digital. Netflix has taken the act of releasing entire seasons in order to try to retain viewers, but it is also one of the things that trigger binge-watching. The launch of Netflix’s unlimited viewing service gave consumers room to ‘binge-watch videos’, as evidenced by data showing that 361,000 Netflix subscribers watched all nine episodes of Stranger Things in one sitting 24 hours after its release Abrams, According to the Netflix Financial Operations Report, Netflix revenue grew from $5.504 billion in 2014 to $24.996 billion in 2020, an increase of 354.1% [10]. Since 2020, the reliance on Netflix has become apparent from the start of the pandemic, adding 16 million subscribers since the 2020 epidemic
Netflix has built a profitable model regarding paid subscriptions since 2007. They allow paid subscription customers to watch unlimited amounts. This change has disrupted traditional business models, but more is needed to build ongoing customer subscriptions. Netflix has built a recommendation system for different audiences, pushing users based on their viewing history, and the recommendation algorithm allows Netflix to leverage its vast database of user consumption patterns and users’ tags, comments, viewing history, etc. If users are unable to find films on the platform that appeals to their interests, they will quickly lose the desire to subscribe. Therefore, it is BCP Business & Management ICAMM 2023 Volume 42 (2023) 187 crucial that users find their favorite films quickly. Netflix encourages users to rate films and express their opinions on how much they like them. According to the study, Netflix has collected more than 190 million ratings so far, from 11.7 million subscribers. As a result, Netflix can use an algorithmic system that calculates multiple regression correlations to provide subscribers with personalised recommendations on a daily basis. In fact, Netflix’s database is one of the company’s most valuable assets. It has the user data of hundreds of millions of Netflix subscribers. Even if other streaming companies also use algorithmic recommendations, they cannot be as accurate and effective as Netflix because they cannot replicate Netflix’s vast database.
The use of social media plays an important part in Netflix’s marketing strategy. Social media platforms such as Twitter disseminate a large amount of content that influences audience consumption. Netflix has successfully used Twitter to promote “Women in prison” and other episodes. The strategy of Netflix’s entry into the Spanish market can be well demonstrated in terms of the use of digital media. In 2015, Netflix began offering video on demand in Spain and a year later, Netflix has become the second most-watched subscription platform in the streaming market. Netflix extracts data from online and social media and user click logs to tailor the user groups with a catalogue of their needs. Unlike traditional models, which focus the attention of the target audience on advertisers rather than directly connecting with Netflix, Netflix’s goal is no longer to negotiate benefits with advertisers but to directly engage viewers and keep them loyal. As an example of concrete action, Netflix showcased an article in its online media centre, ‘The Power of Images’, specifically exploring how the platform uses visuals to generate interest in its programming. Netflix makes a huge impact through the use of popular elements, and major social events, whether absurd or with overtones of revenge. This ability makes it stand out. Netflix’s creative managers argue that if a member’s attention is not captured within 90 seconds. The member is likely to shift their interest to other activities and images and the perfect title will be the most effective way to capture attention in such a short period of time. Netflix believes that traditional ways of promoting TV series are not suitable for streaming video promotion. The most important thing is to connect with the audience through social media, posting the advertised video on the platform of this category to make it viral in order to reach millions of potential viewers.
In summary, Netflix has become a leading player in the streaming industry. Its growth strategy is worth exploring, starting with the conversion of its business model from DVD rental to a paid subscription streaming service, using its large database of users to reference its recommendation algorithms, consolidate users and improve the user experience. As a promotional strategy, the widespread use of social media, posting heavily and interacting closely with viewers, has allowed Netflix to successfully use social media platforms to promote itself. In terms of content, Netflix has created a slate of original content that has powered the globalisation of Netflix and attracted a large audience. However, the issue of restrictions on Netflix’s international development and the high cost of investing in original content still require ongoing attention. The purpose of this research paper is to analyse the current situation of Netflix, the leading company in the streaming services industry. It provides ideas for the future development of other companies in the streaming industry and analyses the current state of the global streaming industry. The downside is the lack of specific data on Netfilx, which may be supported by more evidence in the future when Netflix makes more data public. This paper does not present an in-depth solution to the specific problems encountered by Netflix. Future research directions could continue to develop in this area.