Amazon/Whole Foods: Is Netflix ready to make a similar bold physical move?
J. Bezos listened to Olivia Newton-John, Let’s Get Physical she said, in 1981…
I turned to be wrong as I was anticipating Netflix to buy theaters… it’s another “digital-native” players who has made the most interesting move of the year, Amazon buying Whole Foods [article from The Washington Post].
Amazon keeps leading the charge to change consumers behavior, creating new usage and changing market standards. We should not focus on the idea that Amazon will basically apply its aggressive pricing strategy to Whole Foods offering. We should rather expect Amazon to develop enhanced experiences, leveraging digital behaviors and its design standards in the physical world, creating new expectations that other players will struggle even more to catch up with.
I still expect Netflix and other “digital” players to make similar moves, expanding their ecosystems beyond digital screens, in order to secure their position, protect from new entrants, lock consumers, leverage consumer insights on a larger scope, and boost their AI developments and applications.
Ecosystems are increasing their leadership on the media and entertainment landscape and 2016 saw major moves from leading ones, the GAFA (Google, Apple, Facebook and Amazon). They’ve accelerated their expansion, integrating at scale new features (stereoscopic content, livestream, or even Facebook’s Instagram replicating Snapchat’s leading UI standards), as much as drastically scaling their hardware, including voice-enabled personal assistant (e.g. Amazon’s Echo and Google Home). Other companies have made steps toward the same ambition these past months, expanding their brand beyond their initial utility, especially most of NATU (Netflix, Airbnb, Tesla, Uber). Great examples of this brand stretching are the mobile app updates of both Airbnb and Uber.
Airbnb is transforming itself from a rental company into a travel agency: “The new initiative is called Airbnb Trips, and it now provides the company a way to offer an experience instead of an accommodation. This could a be class or lesson in an obscure subject like ramen making in Tokyo, or a day trip to a secret surfing location in Malibu.” — The Verge, November 17th 2016.
Read Didier Hilhorst words, Design Director at Uber, on the app redesign: ”We used to think our job was done once you got in a car, and that the faster we got you out of our app, the better the experience. But as we looked ahead at each step, we realized we were neglecting the longest part of the journey: being on your way. We thought about the music you might want to listen to on your way, the menu at the restaurant you’re headed to, and how you could stay connected to the people you’re going to see. We built a platform for content that will put you and your journey at the center.” — Medium, November 16th 2016.
One player has still to evolve (once again in its history), and it’s Netflix. Netflix has to make a move. We think it now has to go beyond the utility it has provided developing a compelling SVoD platform. Netflix has to expand the User Experience. Netflix has for sure been a leading force to establish new usage, new standards, new practices. But now that its market, as defined today, is maturing, it will soon if not already be challenged by the other ecosystem, especially Amazon, but also at some point by traditional companies finally offering more attractive SVoD platform (DirecTV Now?). And Netflix has been one of the smartest to evolve leveraging existing revenue streams to develop a new offer.
It’s interesting to observe, based on our last research cycle with UCLA TFT school (focused on UX Design for multi platform ecosystems), that Netflix is the last of the NATU, which has not yet followed the path of the GAFA. No? They still have a single platform experience, limited ramifications to other platform, no hardware, they’ve not expanded the experience as Uber and Airbnb recently announced. No? The only real “brand” expansion we’ve observed at Netflix these past 18 months has been via IP partnership for content developments, with Marvel especially, but nothing more concrete if I may. I’m eager to see Netflix move. Will it be hardware? How to leverage their AI beyond content recommendation which makes less and less sense with their original content auto promotion? Would you expect Netflix to stretch the brand tagline “See What’s Next”?
