Last night, I watched a show on Amazon Prime before I went to bed. In between episodes, Amazon Prime showed me an ad for one of their new movies they’re streaming on their platform. And it gave me a weird thought:
Are Netflix’s days numbered?
In a strange turn of events, will Netflix become the Blockbuster 2.0?
Hear me out:
When streaming first became a thing, Netflix was the three-headed monster which ravaged the likes of Blockbuster, Family Video (who “pivoted” to slang CBD before shutting down their doors for good), and cable television.
You got the infamous “Netflix and chill” phrase before other streaming platforms were even ideas.
Netflix was the king of the hill and looked everyone down on everyone else like the peasants they were.
But Netflix has made a series of braindead decisions.
First, they never offered a free tier with ads like Hulu. They committed to not showing ads and stuck to it. Bravo on them for that.
But as a business plan?
Methinks they could’ve made much more moolah, gained many more subscribers and viewers, and became more profitable as a company if’n they offered a free version and got advertising revenue.
Then, they decided to spend billions—and BILLIONS—of doll-hairs on creating their own shows and movies. Most of which were complete busts. (It makes me wish I was a couple o’ years older, as my chances of writing a show, something I’ve never done, would’ve been to the moon during this phase of their business.)
While they pumped more and more money into their own shows, they lost more and more timeless classics—like The Office, Friends, and other similar shows that get an insane amount of views. Before this happened, these shows were their “flagship” products.
Then, their competitors started popping out of the woodwork. First came Hulu, then Amazon Prime, then Disney+, HBO Max, Peacock, and a thousand other options.
And their competitors did something completely different than Netflix (lesson in there)...
They stopped releasing entire seasons of their shows at once. Instead, they followed the proven principles of releasing one episode per week.
While it might seem like viewers (aka customers) preferred binge watching the entire season in one sitting as soon as it drops, their actions said differently.
This is a classic case of giving people what they need, not what they want.
When Netflix’s competitors switched to a weekly release schedule, it created more buzz around whatever the hottest show was. This buzz led to more organic conversations between fans between episodes. Gave fans breathing room to speculate about the next episode. And resulted in more sign ups from non-subscribers.
In other words…
Netflix’s competitors created a more engaged fanbase. And many of these alternatives pouched some of Netflix’s “flagship” shows, like The Office and Friends. (And Netflix is finally releasing weekly installments with their 3-part Kanye documentary, Jeen-Yuhs, which I highly recommend watching.)
Back to the Amazon Prime ad:
Another massive failure on Netflix’s part is their total lack of advertising. Both inside their platform (where they can run ads for “free”) and outside their platform.
Nobody knew when a new show or movie would drop because Netflix was allergic to advertising. If nobody knows a new show or movie is coming, how can they get excited about said show or movie?
When the Amazon Prime ad popped up last night, the show they promoted looked interesting. It looked like something I’d enjoy watching.
It’s *almost* as if advertising can be helpful instead of annoying when it’s relevant to you. (Which is something Netflix could’ve figured out had they not been allergic to advertising — especially with the show data they collected for each viewer.)
Anyway, this reminds me of the first marketing book I read back when “green.” The book was the 22 Immutable Laws of Marketing, which I listened to back when I did landscaping for a summer.
One of their immutable laws is The Law of Leadership. That it’s better to be first in an industry than better.
And by many counts described here, Netflix is far from the best in their industry. But they were first, so I’ll watch with popcorn in hand to see if their success lasts. Or if they become the first Blockbuster in the digital age.
Alright, let’s cover the lessons in this ditty before we wrap up, so I know you caught all of em:
1. Advertising is a crucial part of business.
When I tell prospective clients that they need to send more emails, most people have a “Netflix mindset.” They think emails are annoying. They hate getting emails themselves, so they’re scared to send them.
You will never win when you play not to lose instead of playing to win.
2. Advertising helps your customers (even if you don’t think it does).
When you have something that improves someone’s life, you owe it to them to advertise. Otherwise, they’ll buy a worse product that won’t help them as much. Or worse: Buy nothing and continue feeling stuck with no hope of improving their circumstances.
This also applies to entertainment. We live in an info-overload world, and escapism and entertainment are a good antidote (even if it’s temporary).
3. Give people what they need and package it like it’s something they want. Don’t just give them what they want.
There’s a reason your customers are your customers and not your bosses or partners. What they say they want is different from what they know they need. Your job is to give them the latter, and package it so it looks like it’s something they want.
4. People’s actions are different than their words.
Let the dollar be your ultimate deciding factor for your offers and business ideas. People say they want one thing. But when it’s time to spend money, they’ll show you what they really want.
5. Spending money doesn’t always result in more.
Most guru advice tells you that the more you spend on “investing in yourself” or “investing in your business,” the more you’ll make.
While I agree with this, it’s not always true. Sometimes you’ll regret investments or buy the wrong course or coach. It’s not the end of the world. These “failures” help you make wiser decisions in the future. But it’s something to think about because gurus preach any investment in yourself or business is a good one.
6. Selling a lower priced offer might help you attract more lifetime customers with a higher lifetime value.
This doesn’t work in every case. For example, if a high-end brand like Louis Vuitton offered cheaper products, they’d “nuke” their branding.
But sometimes offering a lower priced offer can help you “seep” into more people’s psyches. Once they’re in your world, you can “brainwash” them (in a good way…) and help them grow until they can afford your highest paid offers. If you do this right, these folks will be some of your most loyal customers and have some of the highest lifetime value.
7. Do the complete opposite of what everyone else is doing.
This is an ole Earl Nightingale secret. It’s the same as zigging when everyone zags. While defying rules doesn’t always work, it can be the most powerful thing you do in your business, which forever lets you stand head and shoulders above your competitors.
8. Don’t take success for granted.
While Netflix is still the dominant streaming app, I’ve laid out some reasons why they might not be the case over the next 5-10 years.
And if it can happen to Netflix, it can happen to you.
Always grow. Always learn. Always improve. Always innovate.
One way you can do that—if you have a proven offer, that is—is by booking a call with me here. We’ll get the ball rolling and see if there’s an opportunity to improve your emails.