As of March 2017, the net value on Netflix’s service is $11
billion, more than Time Warner and even the combined assets of Viacom, Discovery,
Scripps and AMC. Netflix is also up for 92 Emmy nominations, second only to
HBO.
What’s interesting about these numbers is that while Netflix
may be valuable, it only pulls in $1 of revenue per dollar of net content value vs.
$2-$4 among traditional entertainment companies. Since Netflix does not sell
advertising, marketers should keep an eye out for any changes in the Netflix
business model. If they decide to become more profitable, advertising is the
company’s next logical step, and it will provide a major opportunity for
advertisers. Although Netflix has promised to double the amount of original
content to increase their subscriber base, they are facing increasing competition
from Snapchat/Time Warner, Apple TV, WhatsApp original scripted series and
more.
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