#11: A Case Study: Netflix 2020 – Combining Strategies for Success


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Sep 30, 2023

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#11: A Case Study: Netflix 2020 – Combining Strategies for Success

In the fast-paced and ever-evolving world of streaming services, Netflix has managed to establish itself as a leader in the industry. The company's success can be attributed to its ability to think long-term and think big, as outlined in the GLEe model. By focusing on getting big, leading the market, and expanding its reach, Netflix has been able to stay ahead of its competitors.

To delight customers in hard-to-copy, margin-enhancing ways, Netflix has implemented the DHM model. This model highlights four key strategies that have been crucial to the company's success. First and foremost, personalization plays a significant role in Netflix's ability to retain and attract customers. By curating content based on individual preferences and viewing habits, Netflix ensures that each user has a unique and tailored experience.

Original content is another essential aspect of Netflix's strategy. By investing heavily in producing high-quality and exclusive shows and movies, the streaming giant has been able to differentiate itself from competitors. This not only attracts new subscribers but also encourages existing ones to stay loyal to the platform.

Furthermore, Netflix understands the importance of providing a better watching experience. From intuitive user interfaces to seamless streaming capabilities, the company constantly strives to enhance the overall viewing experience. By focusing on the user's needs and preferences, Netflix ensures that customers have a hassle-free and enjoyable time while using the platform.

Lastly, interactive storytelling has become a significant trend in the streaming industry, and Netflix has embraced it wholeheartedly. By incorporating interactive elements into some of its content, such as the popular "Black Mirror: Bandersnatch," Netflix allows viewers to engage with the story and make choices that affect the outcome. This innovative approach not only captivates audiences but also sets Netflix apart from its competitors.

When it comes to growth, engagement, and monetization, Netflix follows the GEM model. The company prioritizes year-over-year member growth, aiming for a 20% increase annually. This continuous growth ensures that Netflix remains at the forefront of the streaming industry.

Monetization is another crucial aspect of Netflix's strategy. The company focuses on maximizing the lifetime value of its customers, which currently stands at an impressive $290. By providing a wide range of subscription plans and pricing options, Netflix ensures that customers feel they are getting value for their money.

Engagement is closely monitored by Netflix, with a focus on monthly retention rates. The company aims to keep cancellation rates as low as possible, with a goal of only 2% cancellations each month. By constantly analyzing engagement metrics and making improvements based on customer feedback, Netflix keeps its audience engaged and satisfied.

In order to effectively execute these strategies, Netflix utilizes the SMT lockup approach. This approach involves aligning strategy, metrics, and tactics/projects to achieve desired results. However, due to the inherent difficulty in moving retention rates, Netflix's product team relies on a proxy metric to gauge success. One such proxy metric is the percentage of members who watch at least 40 hours per month. This metric serves as an indicator of customer engagement and helps the product team make informed decisions.

In conclusion, Netflix's success can be attributed to its ability to combine various strategies and models to create a unique and appealing streaming experience. By thinking long-term, focusing on delighting customers, and prioritizing growth, engagement, and monetization, Netflix has solidified its position as a leader in the industry.

Actionable Advice:

  • 1. Personalization is key – invest in data-driven algorithms and recommendation systems to provide users with a tailored and enjoyable experience.
  • 2. Focus on creating original and exclusive content – this will not only attract new subscribers but also keep existing ones loyal to your platform.
  • 3. Continuously analyze engagement metrics and make improvements based on customer feedback – this will help keep your audience engaged and satisfied, leading to higher retention rates.


  • GLEe Model: Author's own insights
  • DHM Model: Author's own insights
  • GEM Model: Author's own insights
  • SMT Lockup: Author's own insights
  • Product Hunt TOP hunters: Not mentioned in the source content.

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