#11: A Case Study: Netflix 2020

Applying my strategy frameworks to Netflix today.

Black Mirror’s “Bandersnatch” is one of Netflix’s new interactive stories.
  1. Demonstrate how product strategy evolves, and
  2. Illustrate the strategy models.

The GLEe Model

Earlier in this product strategy series, I outlined how Netflix hoped to “Get Big,” “Lead,” and “Expand” during its startup phase. Below I have added the company’s current focus, as well as a speculative next step, which may have substantial traction in five to ten years:

Should Kimmy “Make-Out” or “Plan Wedding?” You decide.

The DHM Model

There are lots of high-level product hypotheses in test today at Netflix, but I’ve outlined four strategies that I think are most important. Each has the potential to delight customers, in hard-to-copy, margin-enhancing ways:

  • Personalization. This capability makes it easy for members to find and watch movies they’ll love, and it’s also hard to duplicate. Personalization improves Netflix’s margin, too, by enabling Netflix to “right-size” its content investment, based on forecasts of how many members will watch a movie or TV series.
  • Original content. Netflix’s exclusive content delights customers. And the company continues to take advantage of its hard-to-copy economy of scale, investing nearly twice as much in content as its nearest rival.
  • A better watching experience. Netflix invests in tools that make a member’s viewing experience even better. Examples: Ultra HD video/sound, custom playback speed, and lots of hard-to-copy technology that “just works” irrespective of a member’s device and bandwidth.
  • Interactive storytelling. Netflix is building tools both for studios to create interactive stories and for members to “choose their adventure.” Note that Netflix isn’t competing against other streaming services. It’s competing for a share of consumers’ screen time and hopes to win that “moment of truth” when a consumer decides between Netflix, Fortnite, and Instagram.

The GEM Model

After twenty years, Netflix’s membership continues to grow fast. Here’s how the company might force-rank growth, engagement, and monetization today:

The SMT Lockup

Below, I outline four product strategies on the left, along with the proxy metrics and tactics that correspond to each hypothesis:

The Rolling 4-Quarter Product Roadmap

Here’s my speculative roadmap, beginning in Q3 2020:

The key strategies are on the left, and you can see when projects against each strategy will launch. Again, this is a fictional exercise to demonstrate the concept of a roadmap.



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