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What Netflix Has Been Trying To Keep A Secret
The executives at Netflix are RENOWN for not releasing audience numbers for how many people watch Netflix produced content. From the amount of water cooler chat some of the shows get, we can assume it's a lot for some shows. And not so much for others. Obvious winners are those shows that come top to mind: House of Cards. Daredevil. Jessica Jones. Making A Murderer. Orange Is The New Black. But how many people actually watch? With expectations of 100 million global subscribers by 2019... there has to be a reason people are signing up - and viewing.
Hungry for the answer, we culled the internet looking for answers to this question, as it is a weekly conversation within our office. In this blog post Hollywood Branded shares the research we sourced on how many people watch Netflix produced content, and why the platform offers brands a home run opportunity to engage with consumers.
How Network TV Advertising Works
ABC, CBS, CW, Fox, NBC... these networks crow from the top of their lungs about each and every viewer they have managed to entice into watching their shows. Netflix and Amazon - even Crackle and Hulu... not so much as a peep. Why the difference in approach? Ad dollars. The Streaming Video On Demand (SVOD) networks operate very differently than the broadcast and most cable networks in that their models are not media buy ad based.
Your core broadcast and their owned cable networks all operate on an ad-buy basis. That means that all of the TV content on their networks is financed through commercial ad buys. If people don't tune it to watch a TV series, then the ad buyer who is paying for them to be spending time there, and exposed to their commercials, get's upset and stops buying ad time around that show. And if those ad buys don't happen, then there is no more content. And the show is canceled.
How Premium Pay Cable Works
The other TV model is for premium cable networks, which include HBO, Showtime and Starz. These networks send out press releases and report on their viewership partly because they just have the information. Nielsen can easily track it - the systems are set up in households by Nielsen and monitor all major outlet viewing habits. And it does help them a bit in their effort to measure up and stand out among other network competition because it gets them more subscribers willing to watch because if 10 million people are watching well... then it must be good, right?
It's the lemming effect.
And let's face it - if it wasn't for HBO and Showtime having produced content that was a higher value, edgier and just plain good (they don't have to worry about mad ad media buyers being offended) we wouldn't have platforms with content like Netflix and Amazon are even offering today. These networks have proven that people want the good stuff.
Another key difference to SVOD's is that these premium cable networks are aligned with cable and satellite providers, and have set monthly fees in place that the provider charges as part of their overall cable packages, which you add as a group or one by one - we don't pay the cable network directly.
How SVOD Platforms Work
SVOD networks rely on monthly or yearly subscriptions from viewers - much like HBO and Showtime do. But they get the money directly themselves - with no go betweens. So they are getting a much bigger chunk. The platforms are starting to work with cable and satellite providers, so we may be seeing some changes there that they can benefit from by an economy of scale, but their mainstay means... for each subscriber they sign up, they get the money.
So Why Don't They Share Their Viewership?
These SVOD networks aren't working with brand advertisers because... they simply don't need to. Their models are in place where if they have good content, they can get (and keep) subscribers. And they have to pay A LOT to third parties for licensing rights to that content. Which has led them to start producing their own content, that they completely own themselves. It's a tax benefit as well for them, but that's a different story (they have a show that has a hard cost, they have a business division that produced it and gets that cost deducted, multiple business units pay one another in different ways, great way to handle a lot of hard tax profit issues and provide write offs.)
So why don't they share how many people view each of their produced shows? They just don't need to. It does nothing for them as they don't need to prove to an advertiser that key minimum viewership was met. There are no need for make goods for ads that don't get seen by enough people.
An August survey by RBC Capital Markets concluded 15 percent of U.S. Netflix subscribers said that most or all of the content they viewed was original. Another survey said 23 percent said the content was a reason they subscribed.
So Give Us The Viewership Research Already!!!
So here we are... ready to share with you the audience facts we've uncovered from scouring the internet's best resources! Some of this data was drawn from a sample of 2,500 Netflix subscribers watching via computers, tablets or smartphones. No internet-connected TVS.
DMR Stats and Gadgets culled together some interesting facts about Netflix (and they even offer you the ability to purchase the full report of 70 stats if you have interest.)
About Netflix
General Facts
Bloodline
Daredevil
Fuller House
House of Cards
Jessica Jones
Making A Murderer
Master of None
Orange Is The New Black
Unbreakable Kimmy Schmidt
Know more stats we should have included? Please send them to us!
How Can Brands Get Involved In Netflix's Goldmine?
Not all of Netflix shows allow for paid brand integration - in fact, if Netflix owns it fully, they typically don't. But we've got you covered. These shows DO like product placement as it helps make their show more real, and it offsets costs as well. If they don't have to buy something, that money can go back into production.
Take a look at our blog on how brands can take advantate of Netflix for product placement!
Is Product Placement right for your brand? Watch this video to learn more about how this marketing practice works, what brand categories it works for, and the results brand marketers see!
Our Sources:
Topics: SVOD Content - Hollywood
Stacy Jones, Hollywood Branded's founder and CEO, has over twenty six years of leadership experience building global entertainment branding campaigns for top Fortune 500 companies and hundreds of brands. Her career started after receiving her BFA in Theater Production & Scenic Design from the University of Arizona. Acknowledged as an expert in the field, she has appeared on CNN and MSNBC; spoken at conferences around the globe from Germany to Beijing; and has been featured in Forbes, The Wall Street Journal, The Hollywood Reporter, Financial Times, The Economist, Brandweek, Advertising Age, Variety, B&C and Mediaweek amongst others. Originally from Texas, you will still hear her ya’ll as she gathers the team for strategy planning sessions. Like all true entrepreneurs, Stacy is an adventurer at her core – having sky dived, hang glided off bi-planes, swam with crocs while rafting the Zambezi in Africa, photographed grizzly bears in Alaska, trekked Mayan ruins in Belize, explored the ocean as an avid scuba diver, and who loves owning an advertising agency where she swims with a different type of Hollywood shark on a daily basis.
