With its crackdown on account sharing in the rear view, Netflix CFO Spencer Neumann said the streaming company will now focus on building better viewer engagement.
According to Neumann, the ongoing purge of over 100 million accounts, err, borrowers from the platform that began in May enticed many folks to sign up for their own Netflix accounts. But some consumers are a harder sell.
“Paid sharing is a bit front-loaded. The nature of the folks converting tend to be those engaged more with Netflix — and if somebody isn’t interested in Netflix at the time, we’ve got to find their title," Neumann said while speaking at the BofA Securities Media, Communications and Entertainment Conference in New York
While Neumann didn't address it in his talk, Netflix has endured a viewership dry spell recently. Usage was down about 4% year over year in June, when Next TV compared Netflix's Global Top 10 data in 2023 vs. the same period in 2022. And until the recent solid performance of manga adaptation One Piece, Netflix endured a fairly hitless summer.
“We have to improve every aspect of our service. Improving the content, improving the product, improving the marketing, and better monetizing all of that,” Neumann said. “But it starts with content. That’s what our members care about most.”
When asked about potential price increases, Neumann responded that the streaming giant had no plans to mirror competitors like Hulu or Disney.
“Our pricing philosophy is unchanged," Neumann said. "We start with delivering amazing entertainment to our customers at scale, delivering more and more value ... then we monetize that entertainment value to ultimately build widespread price options that address both ends of the spectrum.”
Despite the year-over-year downturn in viewership, Neumann reemphasized his confidence in the value of the content Netflix is putting out. At least in North America, Netflix has far more subscribers vs. any SVOD competition, so it's still getting the most viewership among subscription streaming companies.
“We think we’re starting in a really good leadership position,” said Neumann. “When Nielsen reported their top 10 in the first 28 weeks of this year, we had the No. 1 series 27 of those 28 weeks, and the No. 1 film 24 of those weeks”
Neumann believes that it’s partially Netflix’s ability to produce content abroad driving that success.
“It’s really tough to do well, because it means commissioning content in different countries, in different languages, cultures, tastes, affinities, wrapping technology around it and user interface,” he said. “Most companies are pretty good at one or two of these things — we think we’re pretty good at all of them. So if we continue to stay focused on it we can drive more and more value and build a really big business.”
According to Neumann, that’s how Netflix plans to move forward: by making better content, more efficiently and at no extra cost to the consumer — all in an effort to build customer loyalty.
