The Netflix Weakness: Comfort Content
Netflix is a modern-day juggernaut. The streaming pioneer has almost 200 million subscribers worldwide, has added 50% to its market cap in the past year alone and is valued at over $225 billion. More importantly, the leadership team, led by founder and CEO Reed Hastings, has an almost prophet-like ability to get ahead of a constantly changing media landscape. Even with a flurry of new rivals including Disney+, Peacock, and HBO NOW, Netflix remains the undivided champion for our attention and money.
There is no shortage of praise for the company and it’s team, so when looking for what could actually cause a problem down the road, I really thought about what Netflix was missing. Well…
Oodles of content? Check.
Top notch technology? Check.
Leadership team? Check.
Innovative culture? Check.
Ability to attract top creators? Check.
Global presence? Check.
So where is Netflix behind the curve? For a long time, it didn’t seem like Netflix had a weakness. Slowly, my perspective changed after analyzing my own watching habits. I love TV and movies and Netflix is a constant part of my watching cycle. However, after a look at the ‘Continue Watching’ section of myself, family and friends, I came to the realization that we all had a few shows that were always on our lists. And a deeper dive into the viewing history showed me the same was true for movies.
With the deadline on of my favorite shows, The Office, leaving Netflix quickly approaching, I realized what was lacking: comfort content. Comfort content is the show or movie you can watch anytime, starting at any point for any period of time, regardless of your mood. It’s Friends or Parks and Recreation. It’s Star Wars or Die Hard. It’s not a show about a moment or a pop culture trend. It’s the warm blanket that you watch when you need to unwind or need to turn your brain off for a half hour. Comfort content spurs engaged fan communities, merchandising, fanfiction, memes and intense engagement.
Netflix has a comfort content problem. While they have mastered diversity, quality, and even event television, they have yet to find any significant comfort brands. It may seem like a small problem, but comfort content is an important part of customer stickiness. It keeps customers coming back without needing something to search, sort, or discover.
Disney is a prime example of how to do comfort content right. It may not have the most extensive library, but it has the brands that people want to watch over and over. No one subscribes to Disney+ because they haven’t seen Star Wars, they subscribe because they love the Star Wars Universe and want to watch it whenever they feel like it. Throw in some new content every few months and you have an audience that feels emotionally invested in your brands.
Netflix, on the other hand, seems to depend on a flood of new content to keep viewers interested. With new items released almost daily, Netflix hopes to keep us interested in what’s new rather than what’s comfortable. It’s worked pretty well so far as they expanded globally and new subscribers discovered all Netflix had to offer. However, as the most popular comfort content starts to leave the platform for other streaming services, long time subscribers have started to question whether Netflix is as ‘essential’ as it once was.
Long-term, Netflix will do its best to create content with this type of emotional fan base, but these brands are unicorns that are hard to will into existence. They have to hope that their multi-billion dollar investment gives them enough rewatchable content to keep their customers emotionally invested. They could also go on an acquisition spree and gain permanent ownership of some popular brands. I wouldn’t bet against Reed Hastings and their team finding a way to solve the problem, but this seemingly small problem can snowball quickly.
Viewers have shown us that when there is a sea of content, they will return to the same lifeboat, again and again. Netflix better find its fast, or they may find themselves washed away.