Netflix has been a market leader when it comes to getting to know its audience. It has used social media as an opportunity to gain a competitive advantage over other entertainment providers. For instance, Netflix has been tuned into the social phenomenon of “binge watching” as TV enthusiasts have taken to social media to proclaim how they’ve caved to their TV addictions. According to Kara (2014), “Unlike other binges, of which we might want to stay mum (drinking, eating, shopping…), television binges seem to warrant proclamations on social media, much to the delight of entertainment companies and their marketing teams.” Netflix surveyed their TV streamers and determined that 61% of their audience binge watched regularly (“Netflix declares binge watching,” 2013). Netflix, taking data collected via social media and its own independent study, delivered what its customers wanted. In what could have been considered a fiscally irresponsible move, Netflix released the entire (13-episodes) second season of one of its most popular original series, House of Cards, in January of 2014 and the entire third season in February of 2015. Though there is debate whether Netflix should support this type of TV gluttony, it has certainly provided ROI. Given that Netflix stock has risen from $8.5 to $485 per share since 2002, a 40% compounded rate of return for 13 years (Hartung, 2015), evidence points to the fact that Netflix has used social media to keep its finger on the pulse of what TV viewers want and are delivering content in ways that bolster customer-to-brand loyalty.
Hartung, A. (2015, February 28). Netflix valuation is not a ‘House of Cards’. Forbes. Retrieved from http://www.forbes.com/sites/adamhartung/2015/02/28/netflix-valuation-is-not-a-house-of-cards/
Hartung, A. (2015, February 28). Netflix valuation is not a ‘House of Cards’ [Online image]. Forbes. Retrieved June 23, 2015 from http://www.forbes.com/sites/adamhartung/2015/02/28/netflix-valuation-is-not-a-house-of-cards/
Kara. (2014, April 11). HBO vs. Netflix: The content marketing battle on the small screen (and beyond!) [Web log]. Retrieved from http://trackmaven.com/blog/2014/04/interactive-marketing-hbo-netflix/?utm_expid=66173508-0.SmUuvslXSAmtoseVS0PC1A.0&utm_referrer=https%3A%2F%2Fwww.google.com%2F
Netflix declares binge watching is the new normal. (2013, December 13). PRNewswire. Retrieved from http://www.prnewswire.com/news-releases/netflix-declares-binge-watching-is-the-new-normal-235713431.html