The changing nature of design, marketing and advertising

I did a small case study on Netflix and their marketing strategy, I found it to be a little microcosm into the changing nature of design and marketing today, how technology is changing how the industry is perceived from the days when I was in college to today, I would argue that your traditional print design studios are becoming smaller, quality gradually becoming reduced and through osmosis, a gradual migration to the online realm has already started.

Sharing some details from my marketing course

In marketing you get the four 'P's' - Product, Price, Place and Promotion.

The ‘P’ that I’ll looked closely into for Netflix was their Product. Netflix’s evolution perfectly illustrates the demand of it’s clients as technology changes over time with some analysis on how this company became as successful as it is today. Their product, which effectively is the content they produce, meaning TV series and movies, is their strongest asset and their strength. A strong product has in some ways sold itself, the reputation of the service spreads by word of mouth and series has become the mainstay of office conversation or among friends, this has a knock on effect in other areas of their marketing strategies, examples can be seen in their conservative approach in promotion where other companies rely on the heavy handed approach of advertising, Netflix simply engages with their customers in a lighthearted fun approach through social media and in particular twitter.

Fig. 2; By creating memes of themselves and being openly accessible they have also saved a lot of money by circumventing the traditional promotional methods. Maxim (2019) Going back to the start, we can see how it all started. The initial business model started with DVD sales and rental by mail. It changed it’s strategy after one year and focused on streaming. They did initially consider VHS tapes but rejected the idea as it was considered too expensive to stock and tapes being too delicate to ship. I’m looking at a website called https://izea.com/ that writes about the content and influencer success, a closer look into the origins of Netflix and the appeal of moving onto a steaming platform including the sense of value for money where the cost of a monthly subscription is the same as a cinema ticket in the 2nd paragraph;

“For less than the average cost of seeing a movie in a theater every month. There’s no waiting for a certain movie showing or broadcast time. Netflix’s library of TV shows and movies from all over the world is there for consumers to choose from at any time.” (Izea, 2019)[1]

They started the world’s first online DVD rental store which set them apart from their competition like Blockbuster for example who would have been their main competition, a company that rented VHS tapes of movies and later DVDs as single items. Netflix included a monthly subscription, this was a significant step in their evolution from the traditional rent per item era to their now current model of monthly subscriptions. The price is very competitive at first, with a large variety of options available made them a real threat to companies like Blockbusters, with no need for renting commercial premises.

The convenience of post gave Netflix an advantage over place, you never had to leave the comfort of your own home, the volume and variety gave them an edge over the product with cleverly devised monthly subscriptions gave a sense of value for money, watching as much as you like for a set price.

Fig. 3; Perfectly demonstrates Netflix’s unique selling point, you can watch our content anywhere anytime. It’s convenient and easy, moreover, convenient as demonstrated in

figure 3, I think most people can relate to relaxing on the sofa after a long day at work looking to relax and watch something to suit a particular mood. Bigstock (2020) With Internet speeds increasing and band-width improving through the mid 2000s, Netflix wanted to move their content online for some time and now the technology existed to do so. Youtube showed that there was a demand even for relatively low image quality. This is where their ability to analyse their target audience became a big shift in marketing for them. Once online and signed in on their platform, being able to track who streamed what content, they were able to mine audience data for marketing strategies with 167 million paying customers globally.

Creating original content became ever-increasingly important as time went on, they realised they can produce TV Series that in the long term gives them full control over them as described in this Investopedia website article, 1st paragraph;

“By creating compelling original programming, analyzing its user data to serve subscribers better, and above all by letting people consume content in the ways they prefer, Netflix disrupted the television industry and forced cable companies to change the way they do business.” (Investopedia, 2020)[2]

Fig 4; Original content such as Stranger Things loosened the shackles and changed the landscape of how we perceived content creators for our screens.

And crucially companies like Apple and Disney have now realised that online streaming is the future resulting them to retract their content and develop their own platforms to stream content. Combine that with the binge watching phenomenon where people can get so invested in a series and characters that they feel the need to know what comes next made Netflix particularly effective in garnering subscribers.

As seen here in the 14th paragraph of Investopedia, the binge watching phenomenon became a tool which later became the blue print for other streaming services like Sky where you could get an entire series on demand as shown in the birth of binge watching section of the Investopedia website, this is particularly significant, because it has forever changed the way we think of watching series, it is easy to watch one episode of one program, and then to simply forget about it the following week;

“Around the same time, Netflix started uploading entire seasons of established TV series at once, essentially creating the binge-watching trend, in contrast to broadcast and cable TV’s once-a-week installment model.”(Investopedia, 2020)[3]

Furthermore, they created original content in different countries using local directors in various native languages therefore increasing it’s appeal all over the world. They later became known for some flagship series earmarking them as superior content creators and news spread word by mouth, series like House of Cards and Orange is the New Black as highlighted in paragraph 8 in the website Business of Apps;

“Netflix added another differentiator in 2012: original content. Lilyhammer led the charge in 2012”[4]

A combination of staying ahead of their competitors through technology, creative and original content, and breaking with the traditional norm i.e. releasing an entire series allowing for what is known as the binge watching phenomenon Netflix have grown quickly by having a strong product. By having their own servers like the Open Connect boxes all over the world has enabled them to stream content quicker than other companies and less likely to buffer on slower internet speeds.

Fig. 5; Netflix’s Open Connect box, they have a variety of CDN networks, one way to provide it’s service faster still is to have a open connect box for main internet service providers. When it comes to information technology, and Netflix is no exception, having only one delivery system in place can lead to problems if their is a failure or breach. Having another method and a variety in the delivery medium such as an open connect box provides extra security and safety. Medium (2017) [1] Izea (2019) ‘Netflix Content Marketing’ [online]. Available at: https://izea.com/2019/04/29/netflix-content-marketing/ [accessed 15 May 2020] Investopedia (2020) ‘How Netflix Is Changing the TV Industry’ [online]. Available at: https://www.investopedia.com/articles/investing/060815/how-netflix-changing-tv-industry.asp [accessed 15 May 2020] [3] Investopedia (2020) ‘How Netflix Is Changing the TV Industry’ [online] viewed 1 April 2020. Available at: https://www.investopedia.com/articles/investing/060815/how-netflix-changing-tv-industry.asp [accessed 15 May 2020] [4] Iqbal, M. (2020) ‘Netflix Revenue and Usage Statistics’ Business of Apps [online] viewed 1 April 2020. Available at: https://www.businessofapps.com/data/netflix-statistics/ [accessed 15 May 2020]