Going International
Over the last few years, Netflix has expanded to almost all of the countries in the world in its aim to widen its international market. This means a wider target audience and heavy restructuring of its international marketing strategy to recognise and appeal to the diverse markets that they acquire. How does Netflix optimise its reach over such a fragmented market?
Marketing Communications
This is where Netflix made an astute decision of focusing a majority of their marketing and advertising efforts onto the digital media channels. Not only does digital media provide them with platforms that have an easier reach to such a diverse audience, but it also provides them with an immediate feedback loop to track their target’s responses.
Along with its decision to concentrate on social media platforms (Facebook, Twitters, Instagram etc), Netflix has also aligned with a ‘product based’ marketing strategy over the usual ‘brand based’ marketing strategy. This means that Netflix advertises its exclusive ‘Original Shows’ instead of the traditional method of advertising their entire brand as a service that is provided. Netflix seems to believe that creating a loyal fan base for its original content and getting their audience hooked onto their programming is what in turn will increase their overall subscription numbers. In support of this strategy, Netflix has been continuously adding original content in various languages to accommodate their wide market, leading to over 148 million streaming subscribers worldwide in the fourth quarter of 2018. Of these subscribers, 60.55 million were from the United States and the rest 59% being international subscribers.
Number of Netflix streaming subscribers worldwide tracking Q1 2016 to Q4 2018 (in millions) Source: Statista
Native Advertising
Native Advertising creates advertisements that are in the same style and format that the content audiences are there to consume. Hence marketers provide a much less disruptive advertising experience and in turn draw a higher click rate than the traditional banner ads, particularly on mobile devices. Desktop native click-through rates (CTRs) averaged a respectable 0.15%, while native-mobile ads had CTRs over 1%, according to recent data from Polar Media Group and Celtra, respectively.
Netflix cashed in on this high ROI with some very successful Native Ads in recent history. They started collaborating with reputable online publications and news outlets to provide content that apart from a few references/connections to their exclusive content (that they wanted to advertise), could very well be perceived as credible journalism addressing the needs of the society.
Wall Street Journal – A series of articles about Cocainenomics and the rise and fall of Pablo Escobar just in time to promote their new series ‘Narcos’.
The Atlantic – A multimedia long thread about the dynamic between U.S. presidents and their wives. Titled “The Ascent: Political Destiny and the Makings of a First Couple” the thread is a stylish piece of native advertising, created by The Atlantic‘s in-house agency Re:think to help promote the third season of ‘House of Cards’. The piece was pretty clearly marked as a sponsored content effort on behalf of Netflix and even carried the Netflix and House of Cards logos.
The New York Times – In-depth multimedia feature on women in prison and why the male model doesn’t work, as a piece of native advertising for their series ‘Orange is the New Black’. Even though the article was marked as a paid post, the only direct reference to Netflix in it was Piper Kerman, the author of Orange is the New Black, and the subsequent launch of the Netflix original series.
The common thread between all of Netflix’s native advertising campaigns is that each of these stories would have worked equally well as part of the editorial content of these individual publications. That is what sets Native Advertising apart, the fact that it compels the advertisement to be as true and non-intrusive to the customer’s experience as possible.