The famous subscription model.
From music and films, to a world-first subscription model for antibiotic supply, this business model has made almost anything accessible.
This will be the first blog in our series where we will look at how subscription models have revolutionised the way we consume different media, starting with the streaming powerhouse Netflix, which paved the way for successful subscription models in TV and even transcended the industry into all areas of business.
Next year it will have been 25 years since Netflix debuted its monthly subscription concept, allowing users to pay a flat fee each month to have access to unlimited films, TV series and documentaries. There are a few key reasons why Netflix has shown to be the godfather of all subscription models – being customer focused, acing content strategy and staying ahead of the game through innovation.
Customer-centric subscription model
Netflix’s subscription model not only generates sustainable and consistent revenue through recurring transactions, but enables a customer relationship-based model that builds long term loyalty.
In 2006, Netflix began to introduce its personalisation strategy, gathering data and creating various algorithms to connect users with films, TV series and documentaries they would love. Alongside offering of 24/7 customer support, Netflix has set the standard of customer focused personalisation within the media, increasing customer satisfaction and all-important retention.
Content is King
A key success driver for this media giant lies in its impressive content strategy. Netflix creates quality, original content that simply cannot be found anywhere else – giving subscribers another reason to remain loyal and keep them coming back for more.
Some of the most viewed films and TV shows in the last few years have been Netflix Originals: Bridgerton, The Tinder Swindler, Squid Game and Ozark to name just a few. If you were to leave the subscription, you could end up with serious FOMO on the latest releases that have everyone talking.
Not only does Netflix create its own content, but they release it in a timely manner. For example, splitting a new series into two parts and releasing the latter a month later not only keeps us returning but continues to cement the longevity of the subscription.
Staying on top
With alternative subscription platforms for film and series such as Disney+ and Amazon Prime Video proving popular, Netflix continues to innovate and stay on top of the competition.
While Netflix collects data to serve its customers and help them find content suitable to them, it also analyses the same data to determine what genres and talents could be pursued in response to the demand of viewers. From a DVD mailing service, to online streaming and content production, Netflix is flexible and can evolve and change strategy as needed.
The ability to create original content, personalise the platform for its users and maintain a constant revenue stream is why Netflix has become one of the most effective business models in the world – making this the blueprint for all subscription services out there.
Contact us today and find out more about how we can support new means of revenue with a subscription model.
