In 2017, we should prepare for major newsflow from Netflix

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”?

Here are 3 scenarios we have in mind for Netflix, including one where it would simply be acquired.

• Option 1: New Content Vertical. Now that Netflix is a recognized global brand for high quality storytelling, it could now expand its content offerings to new territories. One of the ambition could be to increase consumer engagement to develop more regular interactions with the platform. Developping journalistic video content could definitely be an option: would it be with a shorter format than what the platform offers today, but still highly engaging and driven by a great storytelling. Netflix could definitely engage in this direction on its own. Or could look for acquisition opportunities such as Mic.com and its 30m+ online uniques, or a more challenged and traditional option such as Tronc (LA times, Chicago Tribune, etc.) which recently stopped discussion with a potential acquirer (Gannett). Regarding content, sports could be another interesting area, but it’s tougher to see the direct connection with Netflix UX/UI.

• Option 2: Physical spaces. Here is likely the most exciting idea Netflix could develop these coming months. What if Netflix buys some physical spaces, especially cinemas? Not only Netflix could create a direct connection with its current offering, creating IRL events for all its original content. But Netflix could also reinvent the very nature of cinema spaces. What if it was leveraging the journalism idea exposed just before to create weekly events? Netflix could then also expand the live experience, bringing its curration skills to add any form of location based entertainment to these spaces, including gaming. Would Netflix be eager enough to buy large existing cinemas network such as Cinemark? More likely we might see smart and small moves towards smaller franchises, step by step building a premium national then global network aligned with the SVoD platform. This real estate development idea, expanding Netflix UX beyond a singled digital platform, would also be a great direct monetization asset (a new premium tier for its pricing?).

• Option 3: Acquired (by Apple?). The last option we’ll list here is an acquistion of Netflix by Apple. Yes there have been many recurring rumors, also involving Disney. And yes, it’s tough to miss all the synergies, for Apple especially, to own a content platform such as Netflix, in order to further leverage its software/hardware ecosystem. Netflix could strengthen its UX design with such integration. The main challenge of course is the size of Netflix, already almost too big for a perfect integration within Apple, too big not to happen with frictions, at least with all Android-powered smartphone owners.

What’s your favorite? Another idea?