Why Can't More Companies Be Like Netflix?
Netflix (NASDAQ: NFLX) is laying all of its title cards on the table. The world's leading premium streaming service rolled out a new Netflix Top 10 hub this week. This isn't the list of the 10 most popular regional titles that viewers scroll through from the Netflix home page when they're trying to figure out what to watch next. The new Top 10 subdomain offers a deeper dive into how many people are actually watching these shows and movies.
Did you know that more than 50 million hours of the new season of Narcos have been streamed worldwide on Netflix over the past week? This week's top movie is Red Notice, scoring 148.7 million hours of viewing over the past seven days. It's a scoreboard. It's a headline maker. It's Netflix taking transparency to a higher level.
Image source: Getty Images.
Rank and file
Lists of ranked popularity aren't new. Apple updates the most popular downloads on its App Store. Robinhood Markets has no problem spilling the beans on its 100 most widely owned stocks. Even our Fool.com homepage will show you a list of trending articles.
However, by offering more granularity Netflix is showing that it doesn't have to hide critical data. It can shout it from the rooftops, because sometimes bragging is more effective than hoarding information.
Aside from the weekly lists that can be sorted by language or country, Netflix is also keeping tabs on that page of its all-time biggest hits. It's a smart move. As Netflix grows in popularity -- its membership has risen nearly 10% over the past year to top 213.6 million subscribers -- its records will fall. We saw this happen with Squid Game recently. The 1.65 billion hours streamed in that show's first 28 days of availability is more than double any other show in the history of the platform.
It all ads up
There was some speculation that Netflix was playing up its viewership numbers as a prelude to jumping into connected TV ads. Netflix has sworn off a push into video advertising in the past. There's some big money to be made in an era where marketers are willing to pay up to reach viewers that don't typically see paid missives.
I don't see that happening. Why would Netflix fix what isn't broken? It's leaving money on the table, sure, but the ad-free nature of the platform is also part of the brand's allure.
Netflix will continue to be the top dog among streaming service stocks, even if it does eventually open the marketing floodgates. However, this seems more like a power play. Netflix is letting the world know how popular its service is, and that will make consumers and producers stay close.
At a run time of almost two hours, the nearly 150 million hours spent streaming Red Notice translates into more than 75 million homes seeing the movie in its first week. When's the last time 75 million families saw a film at a multiplex in its first week of screening? Netflix is getting chatty about its metrics, but it has plenty to gain by letting the world now how popular the platform has become.
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Rick Munarriz owns shares of Apple, Netflix, and Robinhood Markets, Inc. The Motley Fool owns shares of and recommends Apple and Netflix. The Motley Fool recommends the following options: long March 2023 $120 calls on Apple and short March 2023 $130 calls on Apple. The Motley Fool has a disclosure policy.
