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
- Year of Netflix founding: 1997
- Year of digital distribution launch: 1999
- Year of Netflix IPO: 2002
- Total number of Netflix subscribers: 81 million subscribers as of April 2016
- Number of Netflix international subscribers: 34 million as of April 2016
- Percentage of Netflix users that come from outside the US: 42%
- Number of Netflix subscribers in U.S.: 47 million
- Number of hours Netflix users watched in 2015: 5 billion streaming hours
- Number of hours per month that users spend watching Netflix: 10 billion hours
- Number of hours per day that users spend watching Netflix: 100 million hours
- Percentage of Netflix users that binge-watch shows: 70%
General Facts
- The number of scripted TV shows nearly doubled between 2010 and 2015, jumping from 216 to 419.
- Netflix said it plans to produce 600 hours of original programming in 2016, a big leap from the 320 hours it delivered in 2014.
- Half of US TV households now subscribe to SVOD services, like Netflix, Amazon, and Hulu, and viewing of original digital video content is on the rise.
Bloodline
- “Bloodline” attracted 2.4% in its first 30 days.
Daredevil
- 7% of Netflix subscribers watching at least one episode of Daredevil first 11 days.
Fuller House
- Symphony recently released data that indicates Netflix’s Full House sequel drew a staggering 14.4 million viewers between the ages of 18 and 49 within 35 days of its February 26, 2016 premiere date.
House of Cards
- For the 2nd season, 670,000 people binge-watched the new season in its entirety during the first weekend of its release on Netflix - 2% of all subscribers to Netflix at the time. The ENTIRE season.
- An additional 5 to 15% tuned in for one to four episodes of season 3.
- The third season of “House of Cards,” which premiered Feb. 27 2015, attracted 6.5% of subs over its first 30 days
- Nearly half of subs having watched at least three episodes of “House of Cards” in a single day in the first 30 days after release.
- About 6.5 percent of subscribers watched at least one episode of the third season of "House of Cards"
- Mark Fahey at CNBC makes an educated guess that about 5 million people will watch at least the first episode of season 4 within the next 30 days.
Jessica Jones
- From September through December 2015, the average episode of Netflix’s “Jessica Jones” averaged 4.8 million viewers in adults 18-49 during a 35-day viewing cycle
Making A Murderer
- Making a Murderer allegedly got 13.4 million viewers aged 18 to 49 in its first 35 days of streaming.
Master of None
- “Master of None” (produced by Universal TV) grabbed 3.9 million while “Narcos” grabbed 3.2 million during the same frame.
Orange Is The New Black
- According to Nielsen, 6.7 million people watched Orange Is The New Black's season-four premiere from June 17, when it debuted on the service, through June 19.
- Over the same period, 5.9 million people watched the season’s second episode.
- In the first two weeks after “OITNB’s” most recent season bowed in June, Netflix users spent 23%-25% of their TV watching time on the show.
- During the September-December 2015 period, Netflix’s “Orange Is the New Black” averaged 644,000 viewers.
Unbreakable Kimmy Schmidt
- “Unbreakable Kimmy Schmidt attracted 7.3 in its first 30 days.
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:
- Business Insider August 11, 2016
- Business Insider July 1, 2016
- CinemaBlend 2014
- CNBC March 4, 2106
- eMarketer July 15, 2015
- Fortune March 6, 2016
- Vanity Fair June 7, 2016
- Variety April 28, 2015
- Variety January 13, 2016
- Variety June 29, 2016
