• Media
    • Exclusive
    • Buzz
    • Movers & Shakers
    • Events
    • International
  • Focus 2022
  • Television
  • Advertising
    • Goafest 2022
    • PR
    • Mobile/Digital
      • Marketing
  • Radio
  • OTT
  • Print
  • Cable & DTH
  • Brand Stories
  • Leaderspeak
  • STRAIGHT TALK
  • My Column
Friday, May 27, 2022
MediaNews4U
  • Media
    • Exclusive
    • Buzz
    • Movers & Shakers
    • Events
    • International
  • Focus 2022
  • Television
  • Advertising
    • Goafest 2022
    • PR
    • Mobile/Digital
      • Marketing
        • Market Analysis
  • Radio
  • OTT
  • Print
  • Cable & DTH
  • Brand Stories
  • Leaderspeak
  • STRAIGHT TALK
  • My Column
No Result
View All Result
MediaNews4U
  • Media
    • Exclusive
    • Buzz
    • Movers & Shakers
    • Events
    • International
  • Focus 2022
  • Television
  • Advertising
    • Goafest 2022
    • PR
    • Mobile/Digital
      • Marketing
        • Market Analysis
  • Radio
  • OTT
  • Print
  • Cable & DTH
  • Brand Stories
  • Leaderspeak
  • STRAIGHT TALK
  • My Column
No Result
View All Result
MediaNews4U.com
No Result
View All Result
Home Exclusive

AVOD strategy: the way forward for Netflix in the Indian market?

by Neethu Mohan
April 21, 2022
in Exclusive, Featured, OTT
5 min read
Netflix to invest more in India: CEO Reed Hastings on Business Today Show
Share Share ShareShare

The American subscription streaming platform, Netflix, has witnessed a sharp drop in subscribers. The platform has announced the loss of 200,000 customers during the January-March quarter. The platform has also projected a loss of another 2 million customers in the current April-June quarter. Netflix’s share price dropped by more than 35 percent on Wednesday in early trading following the announcement. The war in Ukraine and fierce competition contributed to a loss of subscribers for the first time in more than a decade and predicted deeper losses ahead. The platform attributed the slow growth to a few factors, including multiple users sharing a single account. In addition to the 222 million paying households, Netflix is shared with over 100 million additional households. In 2020, Netflix added 36 million subscribers, which is considered to be the largest annual growth since the platform’s streaming service debuted in 2007.

Reasons for the loss in subscriber numbers

Around the globe, Netflix has 222 million subscribers. According to Guardian, in markets like US and Canada, 75 million out of the total 142 million households have Netflix subscriptions and password sharing accounts for 30 million additional households using the service in North America. At the bottom line, the platform is fighting for new signups from a rapidly shrinking pool of non-subscribers.

Karan Taurani, SVP - Research Analyst (Media & Consumer Discretionary), Elara Capital
Karan Taurani

“The decline is primarily due to trend reversal and unlock, which would have led to a reduction in consumption/time spent on OTT.” Account sharing (50% of the subscribers) and competitive intensity are the other two factors for the decline in subscribers. We believe a larger portion of the decline is due to low subs growth in emerging nations, as they are more price-sensitive and would have adopted offline and other modes of entertainment; developed nations like the US may not have seen a sharp decline as such, as the customer base is stickier with cable ARPU prices being very high,” observes Karan Taurani, AVP, Elara Capital.

Competitive intensity and a high level of penetration may be the only reasons for slower or no growth in the US market subscriber base.

The whole ecosystem of media or content consumption was sure to change post-COVID. This is expected, and media and entertainment content developers shouldn’t have restricted their research and perception from just exposure. There is always an ecological environment wherein the audience consumes the content.

Dr Sumesh Ramankutty
Dr Sumesh Ramankutty

 “Several studies have mentioned the macro factors, especially in this case, like the pandemic, disposable income, more time for entertainment, and no other alternatives, which added to the upsurge/trend during the COVID. This was a trend. The process and viewer consumption patterns will change when the macro factors come back to their original state. The best thing that has happened for OTT is customer acquisition at a faster pace and at a lower cost compared to pre-COVID times. Variables like “Viewers’ motive for consuming content was different during pre-COVID, during COVID, and post-COVID,” said Dr Sumesh Ramankutty, Chief Marketing Officer, Augmont Gold For All.

 “The cognitive and emotional involvement of viewers with the content, especially in web series, has increased during the lockdown, which will drastically change when the environment changes.” The new environment restricts their viewing timing, which means priorities shift. When the big screen was losing money, OTT took advantage of the pandemic opportunity. So, it is not a shock if the marketers have understood the sudden windfall,” he added.

A setback for the SVOD categories on the whole?

Meghna NupurMeghna Nupur 

“The Netflix subscriber and share drop might be a blessing in disguise for their competitors, but only if they plan appropriately.” There has been a significant drop in subscribers in the last few months, mostly since the pandemic relaxation. People during the pandemic have binge-watched a lot of series, movies, documentaries, etc. Therefore, post-relaxation, they are finding other things to do. So, to keep their subscribers and hold onto their market, the SVODs need to keep their plans strong. For instance, Apple seized the streaming rights to CODA, which eclipsed Netflix’s Power of The Dog, among other films, to win Best Picture (2022) at the Academy Awards. Keeping an award-winning programme on their platform made them gain more subscribers. Therefore, it is essential to understand what is right and when to move forward with which plan to lure new viewers. If we talk about a reason why SVOD providers as a whole are facing a setback in the coming quarters, it’ll be due to the raised price of the channel subscription. So, they need to work on the same as well,” said Meghna Nupur, Founder, Meur Fitch.

“Like any business cycle, this should be considered as a trend and OTT is going to be there in households due to the genre, no censorship, freshness and type of content provided. Viewers can now decide what type of content to consume on OTT and big screens post-covid,” added Dr Sumesh.

Way forward

Following a slowdown in subscriber growth, Netflix has decided to launch an ad-supported, cheaper subscription plan. The platform is also finding ways to monetize the vast number of households that aren’t currently paying for the service.

“Another focus is how best to monetize sharing — the 100 million households using another household’s account. This is a big opportunity as these households are already watching Netflix and enjoying our service. Sharing likely helped fuel our growth by getting more people to use and enjoy Netflix. And we’ve always tried to make sharing within a member’s household easy, with features like profiles and multiple streams. While these have been very popular, they’ve created confusion about when and how Netflix can be shared with other households,” the company statement read.

Early last year Netflix started testing different approaches to monetize sharing and, in March, introduced two new paid sharing features, where current members have the choice to pay for additional households, in three markets in Latin America.

“There’s a broad range of engagement when it comes to sharing households, from high to occasional viewing. So, while we won’t be able to monetize all of it right now, we believe it’s a large short-to mid-term opportunity,” said the company.

Dr Sumesh believes that to curb the subscriber loss, it is high time that Netflix became Desi in geographies like India.

“The task is how to retain them. Tier 3 and Tier 4 cities look for regional content, and more such content will help in acquiring more viewers. These cities contributed more to the DD during a time when television ratings were non-existent. It is high time for Netflix to become “Desi,” he said.

Is AVOD a growing route for Netflix in India?

In terms of Indian geography, the AVOD market size is around USD 1.2 billion, with aggregators (YouTube, MX) and sports-based OTTs accounting for nearly 60% of the contribution; Netflix’s entry into AVOD will have a greater negative impact on broadcaster-led OTT’s rather than aggregators and sports-based platforms. Time spent and audience traffic metrics on sports/aggregator-based OTT platforms are nearly 1.5-3x that of broadcasters and other niche OTT platforms, demonstrating the former’s commanding position in AVOD; the shift toward cricket and sports content will help Netflix compete better in the Indian AVOD market, observes Karan.

Echoing Karan’s observations, Dr Sumesh said, “The AVOD strategy that is followed in FTA channels will have a detrimental effect on Netflix. Any advertisement is an interference in the content consumption process, and the main USP of OTT platforms is “No interference” during viewing. The mood and congruence of content versus advertising are poles apart, and it makes the attrition of viewers on Netflix faster. Hence, content planners and advertisers have to sit down together to monetize the opportunity and adopt an innovative method to run commercials. The emergence of HD in the television industry is a classic example of how households wanted to avoid television advertisements. The avoidance of advertisements during OTT viewing will further lead to the avoidance of OTT subscriptions.”

Chandan Bagwe
Chandan Bagwe

“Netflix did not get its content strategy and pricing right. Netflix had difficult in Brazil too initially, but it is cracked the market similarly. They will catchup with the Indian market. Pandemic helped Netflix gain a foothold in India. The streaming giant now stares at a tough road ahead, where quality content and reasonable prices will decide its fate,” Chanda Bagwe, Founder & Director, C Com Digital.

Tags: AVODC Com DigitalChandan BagweKaran TauraniMeghna NupurNetflix

Related Posts

Kotex relaunches in India with its new campaign for Period Panties
Brand Stories

Kotex relaunches in India with its new campaign for Period Panties

by Editorial
May 26, 2022
0

Kotex, a female hygiene brand is now relaunching in India, with Kotex Overnight Period Panties, a product that provides period...

Read more
Zero Gravity Communications crafts OOH campaign for Vadilal Enterprises
Advertising

Zero Gravity Communications crafts OOH campaign for Vadilal Enterprises

by Editorial
May 26, 2022
0

Zero Gravity Communications has come up with an exclusive OOH campaign for its new and existing range of ice creams...

Read more
We will be adding many more regional channels in the near future: Anindya Khare, Zee Media Corporation

We will be adding many more regional channels in the near future: Anindya Khare, Zee Media Corporation

May 24, 2022
TAM Sports New Logo

Average count of Categories, Advertisers and Brands soars in last 4 weeks of IPL 15: TAM Report

May 24, 2022
Customers’ faith in insurance as a secure financial instrument has been bolstered by the pandemic: Vinit Kapahi, Aviva India 

Customers’ faith in insurance as a secure financial instrument has been bolstered by the pandemic: Vinit Kapahi, Aviva India 

May 23, 2022
2022 will usher higher inclination by brands into the gaming industry

Skill and chance not the same; GST proposal detrimental to industry and taxman, bemoan players

May 23, 2022
Standards and guidelines have not kept pace with digital advertising transformation: Dhiraj Gupta, mFilerIt

Standards and guidelines have not kept pace with digital advertising transformation: Dhiraj Gupta, mFilerIt

May 21, 2022
Average count of Categories, Advertisers and Brands soars in last 4 weeks of IPL 15: TAM Report

News overtakes GEC as most popular channel genre in terms of advertising during Jan-Mar’22: TAM Report

May 20, 2022

Subscribe to Newsletters

Trending

Omnicom’s Annalect India elevates executive leadership team; Vishal Srivastava named CEO
Advertising

Omnicom’s Annalect India elevates executive leadership team; Vishal Srivastava named CEO

by Editorial
May 26, 2022
0

Annalect India has announced the elevation of their Executive Leadership team in India. Effective immediately, Vishal Srivastava, former President, Annalect...

Jack Dorsey hangs up his boot after 16 years stint with Twitter, passes the baton to design talent Parag Agrawal

Former Twitter CEO Jack Dorsey steps down from board of directors

May 26, 2022
E + R = O : Effect + Response = Outcome. And the outcome, Cardiac Arrest?

Life isn’t a race, so take it slower, hear the music before your song is over

May 14, 2021
‘Start with an idea or go home’: Piyush Pandey

‘Start with an idea or go home’: Piyush Pandey

May 25, 2022
Instagram’s new test allows people to add music to their feed posts

Instagram launches a new property of exclusive ‘One Minute Music’ tracks for Reels

May 26, 2022

Contact Us :

UPLIFT MEDIANEWS4U DIGITAL PVT LTD

No. 194B , Aram Nagar 2, JP Road

Versova, Andheri West

Mumbai – 400061

Umanath.V
+91-99400-17868
umanath@medianews4u.com

© 2019 medianews4u.com

No Result
View All Result
  • Media
    • Exclusive
    • Buzz
    • Movers & Shakers
    • Events
    • International
  • Focus 2022
  • Television
  • Advertising
    • Goafest 2022
    • PR
    • Mobile/Digital
      • Marketing
  • Radio
  • OTT
  • Print
  • Cable & DTH
  • Brand Stories
  • Leaderspeak
  • STRAIGHT TALK
  • My Column

© 2022 JNews - Premium WordPress news & magazine theme by Jegtheme.