NETFLIX UPDATE

Netflix Q3 2021 Earnings Insights into Netflix’s Kids Strategy


Emily Horgan, an independent media analyst, came back to us with all the big news from Netflix’s Q3 earnings call, especially as it relates to Netflix’s kids strategy. If you missed the Q2 2021 roundup, check it out before diving into these insights on Netflix’s Q3.

Netflix Q3 2021 earnings went ahead as usual this week. Before we dive into the kids content notes it is worth mentioning that it was against the background of the growth of company titles. David Chappell’s most recent stand-up show, The Closer, landed on the service, drawing significant condemnation. Critics, including employees, say the show promotes orthodoxy against transgender people. The call did not discuss the issue, which is not surprising given the focus on investor metrics, such as finances and subscriptions in general.

Broad title

In terms of subscriptions, the service is now driven by an increase in paid membership up to 214m, mainly EMEA and APAC. The growth of UCAN and LATAM was thought to be soft. Production delays from Kovid have all been caught, so, aside from further lockdown, expectations should continue on a full-fledged content slate, including “still offering strong Q4 content”. Kids content has dropped in the last few weeks after returning to school: Oggy Oggy (Aug. 2), I Heart Arlo (Aug. 2), Sharkdog (Sept. Sept.), My Little Pony: A New Generation (Sept. 24), Ada Twist, Scientist (September 28), World of Action (October 15), Maya and the Three of them coming on Friday, October 22nd.

Content reporting metrics

The big news is that Netflix is ​​changing the way content is reported in terms of success, promising to publish numbers more often. The original measurement will go from “Number of Visited Accounts” to “Number of Visited Hours”. This is similar to how Nielsen publicly reports on SVOD in the United States. Ted Sarandos ’recent appearance at Code Con predicts this, where he has unveiled the top 10 shows through both the series and the film Matrix, see below. This is a timely change, with Netflix, as the dominant SVOD in the marketplace, being able to influence the criteria that will be judged by others. Under this metric there will be a tendency for numbers to be significantly oblique by the length of the content, the volume of the episode, and even the section.

Ranking of previous series and movies by family

Netflix Code Conference HH

Ranking of series and movies viewed by the hour

Netflix Code Conference HW

Unfortunately, no kids content made this top 10s. Although the U.S. Nielsen SVOD results are judged by cut-through, there is a good chance that this metric will show some optimism for small-slanted content due to major repeatability. However, an unfortunate side effect is that it will make all previously published statistics completely incomparable. A tear is likely to fall on deaf ears for both running parallel as an indicator of both reach and engagement. It’s a shame for anyone creating a kids brand or suffrage.

That being said, the “members saw” metric was scheduled to exit with a push. The South Korean event, the squid game, has landed as the most successful Netflix original by miles in a country. 142 million members watched the show, 57% more than the next successful series. Who could have guessed that a humble local production could so well isolate the hitmaker, Shanda Rhymes Bridgeton? Also, what is the relevance of violent, high-anxiety, survival drama in an article about children’s content? Excluding playground games that simplify the death selection process, the series also has a wonderful footprint on gaming platform Roblox, where half of the 43 million users per day are under 13 years old.

Gaming has become a more widely discussed topic, especially with the recent acquisition of Netflix’s Night School Studios. They continue to position it as a long-term vertical that will have to create the slow steady pace that they had with the content genre. They are very much watching the offer being made in the service.

The Roald Dahl Acquisition and Kids

Their other major acquisitions of The Roald Pulses Story Company were also in the front and center. Dahl’s characters were noted for their “ability to persevere” for both children and parents, in addition to having a good track record in films featuring IP. Overall, there is a lot of interest in creating high-end, feature-quality content from these stories while retaining both internal team and talent. It is hoped that success in this area will spread to consumer products and gaming as well. Currently announced projects include two Willie Wanka spin-offs from Oscar winner Taika Wetti.

Ted Sarandos talks in detail about the content of the kids. Asked about success, he said with fair humility, “It’s still a long way off … We’ve got this part of the business that will take a little longer to prove itself.” I think when Disney is your benchmark, providing kids content seems like an uphill struggle.

Interestingly, he said he doesn’t believe kids need a “huge instrument” to build brand loyalty around character. This goes against the subsequent comments about consumer products being “a great way to increase content and relationships with fans”. Perhaps “Machine” is a necessity or otherwise a reference to the dramatic release of children’s films. Many high-quality animated features went live streaming last year across both Netflix and Disney +, with the next Pixar movie Soul and Luca shipping directly to customers without premium payment. The truth is that Netflix kids storytellers have a believable array of their paychecks, which can be a lot of excitement.

Data

This leads us to content performance this quarter. Vivo, produced by Sony Pictures Animation, has shown Lynn Manuel Miranda as a music and voice talent, the second largest animated feature on Netflix so far. It beats the internal animated original Over the Moon with tuning-million families. Below is the overall ranking ranking of the children’s content “DateDots”:

Kids

We had a few more details on adolescent / child related content. Gender Swap Derivatives His All That Featured Tic Tac Toe Addison Roy. The performance across 55 million households was clearly enough for Netflix to sign a multi-film deal with him. The third and final installment of The Kissing Booth series had 59 million family watches. Adolescent content was uncommonly mentioned about the overall growth of each member of the service. Here’s how kids rankings with teen films:

Kids and teens

And finally.

When we move to Q4, it seems that in recent weeks a lot of high quality kids content has been put forward as mentioned above. Chris Nee’s Ridley Jones, which we have yet to see any concrete performance data, will see its second season on November 2nd. Then we head to Christmas with family movies and special landings. These include Ardman’s Robin Robin, The Princess Switch featuring Vanessa Hudgens and the next real Netflix original animated feature Back to the Outback.





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