The bloom is certainly not off the rose for Netflix’s original-content strategy.
The number of the streamer’s U.S. subs who have watched Netflix originals like “Orange Is the New Black” rose markedly over the six-month span between Q1 and Q3 this year, according to a new study by research and consulting firm Centris Marketing Science. In the third quarter of 2014, 72% of domestic subs said they have watched at least some Netflix original programming, up from 57% in the first quarter of the year, Centris found.
Why the lift? One explanation is that over that period Netflix has rolled out new shows — such as the adult-themed animated series “BoJack Horseman,” the final season of “The Killing” and season two of “OITNB” — along with documentaries including “E-Team” and “Print the Legend.”
Netflix’s marketing, as well as social media and old-fashioned word-of-mouth, also likely played a role, not to mention its 31 Primetime Emmy nominations this year (despite failing to win any major categories).
There are some caveats on the latest Centris study. The stats only indicate whether Netflix users have ever watched its original programming, not how many individual titles they’ve viewed. Also, the study did not measure how satisfied customers were with the content.
Still, the report shows that the majority of Netflix users are at least sampling the originals lineup. And the strategy is an increasingly important retention tool: 57% of Netflix subscribers agreed that original content was “extremely important,” “quite important,” or “moderately important” to their decision to keep the service, according to an RBC Capital Markets survey in September. That’s up from 43% on RBC’s survey in August 2013.
As a way to acquire new subscribers, though, Netflix’s growth for 2013 may have received a onetime lift from its initial launch of high-profile originals “House of Cards” and “Orange Is the New Black,” CFO David Wells said at a recent investment conference. “We knew that the PR bloom around launching something brand-new in the market… wouldn’t last forever,” he said.
Getting a read on Netflix viewing metrics for anyone other than Netflix itself is difficult. The company only selectively shares data externally, and because it is not an ad-supported isn’t obligated to report audience numbers. Nielsen last week announced plans to measure SVOD services like Netflix — but initially, the ratings firm will provide figures to content owners only for their own programming.
According to Centris, viewership of Netflix originals continues to be highest among millennials, with 76% of subscribers 18-34 tuning in (versus 61% in Q1). But viewing of original Netflix content was up across all age groups: 71% for subscribers 35-44; 64% for those 45-54; and 60% for the 55-plus. The data is based on surveys of 1,282 Netflix subscribers in Q1 and 2,080 in Q3.
Originals in Netflix’s pipeline include epic adventure series “Marco Polo,” about the 13th century explorer, set to debut Dec. 12. Next year, Netflix will launch the third seasons of “House of Cards” and “OITNB,” thriller “Bloodline” (from the creators of “Damages”) and comedy “Grace and Frankie,” starring Jane Fonda and Lily Tomlin.
The company continues to cut more deals for original series. Just last week, Netflix ordered a fourth season of crime drama “Longmire” (previously on A&E) and two seasons of comedy “Unbreakable Kimmy Schmidt” from Tina Fey and Robert Carlock, originally slated for NBC. And don’t forget the pact with Weinstein Co. for its first original movie, “Crouching Tiger, Hidden Dragon: The Green Legend,” slated to debut Aug. 28, 2015, the same day it hits Imax theaters — a move that has theater chains in tizzy.