According to a recent Deloitte study, subscriber churn in the United States is 37 percent, with consumers canceling their services due to cost issues and lack of new content.
For Raj Shah, an analyst at digital consultancy Publicis Sapient, this behavior was not surprising. “One-off hits like ‘Bridgerton’ aren’t enough to keep subscribers hooked,” he said in an email. “It takes a set of well-timed, popular, must-have programs to attract and retain customers.”
In the earnings interview, Ted Sarandos, the other co-chief executive, pointed to the new season of “Stranger Things” and the latest episode of “Ozark” as must-see content, along with films such as the sequel to “Knives Out” and ” The Gray Man”, a new action movie from the filmmakers behind “The Avengers”, starring Ryan Gosling.
The company lost 600,000 subscribers in the United States and Canada, mainly due to its most recent price increase. Asia was the only region to show growth, with Japan, India and the Philippines adding subscribers, among others.
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The company said it plans to boost its revenue growth by improving all of Netflix, especially “the quality of our programming and recommendations, which our members value most.” The company also said it would “double down on story development and creative excellence,” pointing to recent successes, including two shows created by Shonda Rhimes — the second season of “Bridgerton,” which generated 627 million hours of viewing, and “Inventing.” Anna,” with 512 million hours watched – as well as the family adventure film “The Adam Project,” starring Ryan Reynolds, which was watched 233 million hours.
On the product side, Netflix said the introduction of the “double thumbs up” button, which allows viewers to “express what they really love,” should help the company improve its personalized recommendations for consumers.
Netflix is also trying to curb password sharing between households — a global phenomenon that the company says represents 100 million unauthorized users. To counter this, the company has begun testing solutions in three markets in Latin America, with one option allowing current members to pay for additional households.
