Remembering When Netflix Almost Died And Other Inspirational Consumption
TXT ME and 4-Hour Work Week
When Netflix Almost Committed Suicide
Netflix is planning to spend $8 Billion (!!) on original programming in 2018. What a comeback.
Wednesday’s edition (2/28/18) of The Mission Newsletter, included the following blurb:
Marketing Trends
At yesterday’s Morgan Stanley Technology, Media and Telecom Conference Conference, Netflix’s CFO David Wells announced that Netflix is planning to produce 700 original shows and movies in 2018… That’s almost two a day. To produce this massive amount of content, Netflix has set aside $8 billion. Their end goal: for at least half of their library to be original content by the end of 2018.
“Let’s continue to add content — it’s working, it’s driving growth.” -David Wells
Netflix is planning 80 feature length movies which is more than Disney, Universal and Warner Bros, combined (from http://time.com/money/4985396/netflix-8-billion-2018-programming/)
As I was reading these staggering numbers, I immediately thought back to 2011 when I received a series of emails from then-CEO of Netflix, Reed Hastings about splitting the DVD-By-Mail service from streaming and raising prices by 60% for customers who wanted both to keep their current service.
They lost over 800,000 subscribers and their stock price dropped off a cliff almost 80% and Blockbuster was making a comeback.
He clearly wasn’t wrong in his goal to drive customers away from the DVD-By-Mail service towards streaming. He could see the future even if his customers couldn’t [Guilty. What? I liked getting the DVDs in the mail].
Subscription guru, Tien Tzuo (CEO and Co-Founder of Zoura), had some insight on where Netflix went so wrong.
Netflix had built a substantial business built on subscriptions. But Netflix violated the number-one rule of subscription businesses: It’s all about the relationship. Relationships are a two-way street. And when Netflix made a unilateral decision to change the relationship, without consulting the other side, it got burned badly.
According to Tzuo, the way they turned things around was listening to their customers. What did they want? Pretty much everything.
- Access from anywhere
- Simple User Interface with Personalized Choices and Recommendations
- Quality Original Programming
Tzou on original programming:
Netflix had an edge if it could be relentlessly data-driven in developing new shows. A little-known British show called House of Cards has done notably well with their viewers, and Netflix knew that David Fincher, Kevin Spacey and Robin Wright were all very popular with Netflix audience. The Venn diagram was complete.
Less important but still appreciated, was CEO Reed Hastings walking back his mistake by sending several damage-control emails like a boyfriend who got drunk the night before and was flirting with other girls.
This tale is equal parts cautionary and inspirational.
What a comeback.
Gum Sales Are Down Because Of Your Mobile Phone And Other Lessons From TXT ME
I just finished TXT ME by B. Bonin Bough, Chief Media and E-Commerce Officer for Mondelēz International.
Bough details the smart phone’s impact on society along with social media’s overall “flattening” of society’s traditional structures and hierarchy.
Giving the power back to the people.
There were certainly enough insights and interesting stories to blow it out into a full ‘diet’ book report. But I’ll just highlight one of the more memorable examples [mostly because I didn’t jot down any notes].
After years of steady growth, gum manufacturers are scratching their heads with the recent decline in sales. Especially because the overall snack category has remained steady.
Gum is typically an impulse purchase. Strategically located near the cash register. It relies on your eyes browsing the hot zone in the grocery store while waiting in line.
The major difference between now and 4–5 years ago is instead of browsing gum and candy, customers are browsing their email and social media feeds or better yet, ordering their grocery via a delivery app and aren’t even in line at all.
This is one of many examples of how technology is moving much faster than business. Even the book itself, published in 2015 is already outdated in a number of ways.
For one, completely underestimating social media’s impact on cable news and politics. Bough touches on politics and how close voters are to politicians and candidates but he could have never predicted the circus that is Trump and 2018 politics.
Tim Ferris, Titan of Media
On the most recent episode of the Tim Ferris Show, Ferris answered questions from readers of his weekly newsletter, 5-Bullet Friday.
5-Bullet Friday, which — every Friday — sends five bullet points of cool things I’ve found that week, including apps, books, gadgets, albums, articles, new hacks or tricks, and — of course — all sorts of weird stuff I dig up around the world. It’s free, it’s always going to be free, and you can check it out here: tim.blog/friday.
In the pod he covers:
- The five health markers I check and watch regularly.
- Strategies to prevent or minimize binge eating during times of stress.
- The most valuable skills for securing financial freedom.
- My philospophy on having children.
- Productivity advice
- And much, much more.
Not a bad haul for 70 minutes worth of listening.
I’m also just starting his first book, The Four-Hour Workweek, from 2007.
Admittedly, I am a sucker for a good quote. Succinctly summarizing a point is a gift I appreciate.
Ferris leads off most chapters and examples with great quotes related to the topic [aside from an untimely Bill Cosby quote. It was 2007, how could he have known?]
Below are a few of my favorites.
Action may not always bring happiness, but there is no happiness without action. — Benjiman Disraeli, former British Prime Minister
Set aside a certain number of days, during which you shall be content with the scantiest and cheapest fare, with course and rough dress, saying to yourself the while: “Is this the condition I feared?” — Seneca [related to imagining the worst-case scenario to strip away the power that fear plays in paralyzing decision-making]
I am an old man and have known many great troubles, but most of them never happened — Mark Twain
The reasonable man adapts himself to the world; the unreasonable one persists in trying to adapt the world to himself. There for all progress depends on the unreasonable man. — George Bernard Shaw, Maxims for Revolutionists
If you can’t tell, this book is meant to inspire dramatic action. I am not necessarily looking for a whole-sale life change, but I think these principles can be applied in many different forms.
I will definitely have more to say on this one once I finish it.
