Netflix seems to be in a death spiral.
Yes, according to recent news articles, their share price has plunged dramatically. Not only that, subscribers (even decades long subscribers) are cancelling by the thousands. But is it really the end for this pioneering streaming platform?
More importantly, why is this happening?
Well IMHO, here are some of the reasons why Netflix is going down.
(Plus some ideas on how they can turn things around.)
1. The Binge Model
The problem with Netflix is that the platform is really a victim of its own success. One of the reasons why streaming became so popular was because you could binge watch shows. This created an entirely new dynamic compared to watching traditional TV. In fact, it was one of the major selling points of streaming.
Unfortunately, this success is also a double edged sword. The reason why is because being able to watch every episode at once, also means you don’t have to subscribe for very long.
If there’s something you’re really interested in you can sign up, watch it in a day, and cancel. Another problem is that, in order to keep up with the insatiable level of consumption, Netflix started pumping out as much content as possible. Which brings us to the second point.
2. Garbage Content
The big joke is that Netflix will green light literally anything. And this is really the problem. It doesn’t pay to pump out garbage content. It’s about quality not quantity. This is the real reason why so many people are unsubscribing. Netflix originals equal garbage and people know it. Even worse, they’ve developed a reputation for…
3. Cancelling Shows
Netflix is notorious for cancelling shows. If you search for “list of cancelled Netflix shows” you’ll discover that the platform has done away with more than 50+ shows over the years. This is a big problem if you want subscribers to stick around. You see, you need to get them invested…and…this isn’t going to happen if you immediately cancel everything.
Not only is this bad for the platform and bad for subscribers, it’s also bad for creators. If you had a killer idea for a show…and…you knew Netflix would more than likely end up cancelling you…well…would you even bother approaching them? Probably not. These issues are also compounded by the fact that they’re now facing…
4. Massively Increased Competition
Back in the day Netflix was the top dog, numero uno of the streaming world. Today there are dozens of streaming platforms. HBO Max, Hulu, Peacock, Amazon Prime, Disney+, and the list goes on (even CNN had a streaming platform for about 5 minutes.) Not only are these platforms competing with Netflix, but they’re also pulling licensed content. And to deal with these issues Netflix is…
5. Raising Prices.
This isn’t nearly as much of a problem as people think it is. Most customers are happy to accept a reasonable price increase – provided you’re selling a quality product. As we’ve seen, Netflix isn’t providing quality. Which is why price increases are a major reason why people are unsubscribing.
These are just a few of the challenges facing our beloved streaming platform.
But will Netflix survive?
To be honest, it’s hard to see what the future holds. They may turn things around or continue to decline. Whether or not this happens will really depend on the people in charge. The fact is that subscribers must be weaned off the binge model. Netflix needs to release less, higher quality content. In addition to this they need to stop raising prices.
And this is the lesson for internet marketers
You absolutely cannot pump out garbage content.
Remember, content is king and the biggest reason why Netflix is failing is because their content sucks. Another lesson is that you need to stay on your toes. Just because you’re the market leader today, doesn’t mean it’s going to stay that way forever.
What’s more, you need to continually examine your business model and look for weak spots.
What’s working today may not necessarily work tomorrow.
P.S. It’s hard to know how much of this is actually true. You see, part of the reason why Netflix is in decline is because of the competition. What I’m trying to say is that a lot of these stories may be negative PR planted by other streaming platforms. I don’t want to sound like a conspiracy theorist, but who knows what the truth is?