What do people watch on Netflix? Finally an answer.
A new study details what they're watching and why, which is important
September 22, 2016
Premiere week means lots of attention on the broadcast networks and their new roster of shows competing for viewers’ attention. But these days, those networks have much more than each other to worry about. Netflix represents another competitor, and that’s why media buyers and planners are desperate for any glimmer of information about who’s watching what on the streaming service, which is notoriously secretive about its numbers. That led 7Park Data, a data intelligence provider, to delve into the numbers on Netflix based on 1 more than million over the top network users around the world. What it found: Library content (older shows such as “Friends” and older seasons of current shows like “Archer”) outperforms originals, sitcoms are the most popular genre, and TV shows get more viewers than movies. Brian Lichtenberger, chief executive officer at 7Park Data, talks to Media Life about why “Friends” endures, how viewing preferences differ from country to country, and why old ratings models are quickly becoming outdated.
What’s the most surprising thing you learned from it?
When you look at library content, just the fact that some of these old favorites–sitcoms such as “Friends” or shows like “Family Guy”–the fact that these are highly rated shows and that library content is so prevalent, it’s interesting that original content gets all the press.
Library content continues to be a significant interest of consumers. They want to consume a broad portfolio of things, and that includes things that have been around for 10 years or more.
What’s the most important takeaway for media buyers and planners?
You’ve got an entire industry that’s undergoing dramatic change. Ad-supported TV has been buoyed the past few years by live events, etc. We see content consumption through a different lens–we look at competition for attention.
We think about content owners have to compete with the likes of YouTube, Facebook and Snapchat, along with other types of content.
When you think about movie theaters, we’re working on some information that we think could highlight how content launches could have an impact around the time of various movie releases. You’ve got all these related dynamics–there is significant change in the industry. The currency that’s been in place for years with Nielsen, and I don’t mean to single them out specifically, but the reality is the future of measurement is not “Nielsen tells us what happened last night.” It’s much more fragmented.
Why do you think “Family Guy” and “Archer” saw summer declines?
There’s a seasonality to content viewing. It’s tough to say those two titles specifically were affected. There is something to the fact that you think about the audiences of those shows–there is some seasonality to those trends when you look at dramas, procedurals, sitcoms, etc.
That would be the most likely scenario for me, although I can’t say for certain that’s what the underlying factor was.
Why are sitcoms so popular on Netflix?
A few things. One, I think the 30-minute format is interesting to viewers.
The reality is they’re highly “binge-able.” We say 30-minute sitcoms, but it’s not always a full 30. You can sometimes rip through three episodes in an hour. I would describe something like “Friends” almost timeless. Sure it feels dated, but it doesn’t really matter. Particularly for younger viewers–they never watched “Friends” in real time, so Netflix is kind of a discovery tool to watch.
Also, these American sitcoms, they travel really well internationally. I guess in some respects, the utility of that type of programming is a part of what has made it popular on syndication for such a long time. There are benefits to being able to catch up on many seasons in a short period of time. The short form and international interest are both really appealing to viewers.
Also, it’s not clear how much their recommendation engines incent that. It’s something we can’t really explore, although it would be interesting.
Netflix, Hulu and others leverage tastes as a competitive advantage. And that’s one thing that content owners don’t have.
It’s a challenge for owners to figure out the right place to put content, what it’s worth etc. I think they’re all challenging questions.
How does original Netflix programming viewing compare to acquired content? What’s more valuable to Netflix?
You can see the strategy of having enough original and high-profile content to drive people to want to pay a fee each month for access to it.
But you also need to have enough other content that’s relevant to fill the gaps. The reality is you can’t have a high-profile show that every user wants to watch every night. So you need other content to fill those gaps.
The goal of a lot of these companies is to want to have enough to bridge the gaps so users don’t churn to other services. It’s a hard thing to do, and part of what you’ve seen this explosion of scripted content. They’re trying to build up that library.
Original content in our data is anywhere from 15 to 23 percent of total viewing, depending on the month. So for a month where “Orange is the New Black” launches, it’ll be in the 20s, but when there’s no launch it will normalize back to the mid-teens. That said, original content only constitutes a small percentage of their total content.
That represents a big opportunity for an OTT provider to engage the audience. On the other side, it’s expensive. Meanwhile, library content continues to demand the greater share of viewing time, and that’s likely to continue for the foreseeable future.
With respect to what’s most valuable, I think that’s something that’s different for Netflix versus, HBO versus CBS, etc. They each have a different perspective.
How does viewership of movies compare to TV shows on Netflix–is one more popular than another?
Again, it’s a tough comparison for movies, because you usually only watch it once, and that’s for about two hours.
But something like “Making a Murderer” or “Friends”–library content is so big because there are hundreds of hours of content. It’s a tough comparison. But I do think there’s also something to platforms essentially catering to the tastes of users, and they increasingly to want to watch TV programs.
I think it’s a different experience–some people will burn three to five hours per night on a show, but a movie is a different experience.
For example, estimated 9 million subscribers watched “Orange is the New Black” in June, and the biggest movie in that month had about 2 million viewers.
Also, with a lot of movies, they come out first in the theater and you can also download it from other providers [in addition to Netflix and other OTT services]. So when you look at original content, you’re comparing a launch versus what’s almost a syndicated run of the movies.
What conclusions can you draw about viewer habits in countries outside the U.S. based on the popular shows?
Generally speaking, there’s a huge appetite for American content in international markets. There’s also a massive opportunity for well-done content tailored to local international markets. Netflix has talked about how big “Narcos” was, particularly in Latin American markets.
At the same time, you look at a show like “Marseille,” that didn’t do very well, at least in our panel and data. For now there’s just not a lot of original international content available yet.
Why is it important to keep an eye on Netflix/OTT viewership patterns?
One, that’s increasingly where viewers are spending a significant amount of their time. Two, those content tastes are evolving.
I think the idea of bingeing has had a direct impact on the type of content being consumed. Tastes evolve very quickly. New shows and genres like “Making a Murder” can happen quickly and go viral and impact what viewers want to watch.
The pressure is on the linear TV model. Those that don’t have their strategy mapped out with how to deal with a different marketplace are going to be significantly left behind by those that did.
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