The Netflix Effect on D2C Services

It’s hard to ignore the headlines on streaming services as powerhouses like Disney enter the direct-to-consumer landscape. Everyone knows that Netflix, with 158 million global subscribers, is the one to beat. And yet industry pundits are starting to predict the demise of the king of streaming, saying that its days are numbered if the company can’t create new revenue streams through advertising.

In our new ebook, “The Netflix Effect on Direct-to-Consumer Services: Balancing the Levers of Price, Content, Quality of Experience,” we break down Netflix’s strategy, how it has impacted this market, and what it tells other D2C services that are competing for consumer attention. 

We determined that there are three basic levers that determine the success of any streaming service from a consumer perspective – the cost of the subscription, the content included in that subscription and the quality of the viewing experience. 

Service providers are constantly trying to balance these levers to create satisfied and loyal subscribers for long-term success. Based on our analysis and experience working with Netflix and other top streaming services, the natural conclusion is that the easiest and cheapest lever is enhancing quality of experience (QoE) for streaming services to gain a competitive edge. 

In fact, Netflix has stated to its investors, “We believe we will have a more valuable business in the long term by staying out of competing for ad revenue and instead entirely focusing on competing for viewer satisfaction.”

Download the ebook to see if you agree with our analysis and conclusions on what we are calling The Netflix Effect on D2C services.

Written by: 

Michael Jones
SVP and Head of Business Development