A Consumer-Based Examination of Netflix Inc. Original Programming and Streaming Strategy

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A Consumer-Based Examination of Netflix Inc. Original Programming and Streaming Strategy Streaming is the New Black: A Consumer-based Examination of Netflix Inc. Original Programming and Streaming Strategy A Thesis Submitted to the Faculty of Drexel University by Lindsay B. Strott in partial fulfillment of the requirements for the degree of Master of Science in Television Management March 2015 © Copy Right 2015 Lindsay B. Strott. All Rights Reserved i Acknowledgements Thank you to my thesis advisor Dr. Lydia Timmins and program director Al Tedesco for your guidance throughout my studies and the thesis writing process. I would also like to thank my family, friends, and classmates for their support and encouragement. ii Table of Contents List of Tables ............................................................................................................. vii List of Figures ........................................................................................................... viii List of Appendices ...................................................................................................... xi Abstract ...................................................................................................................... xii Chapter 1 : Introduction ............................................................................................ 1 1.1 Introduction ............................................................................................................. 1 1.2 Statement of the Problem ........................................................................................ 4 1.3 Background ............................................................................................................. 8 1.4 Purpose of the Study ............................................................................................. 20 1.5 Research Questions ............................................................................................... 21 1.6 Significance to the Field ....................................................................................... 22 1.7 Definitions............................................................................................................. 22 1.8 Limitations ............................................................................................................ 25 1.9 Ethical Considerations .......................................................................................... 25 Chapter 2 : Literature Search ................................................................................. 26 2.1 Introduction ........................................................................................................... 26 2.2 Who online video users are ................................................................................... 27 2.3 What online video users watch ............................................................................. 31 2.4 How users find content ......................................................................................... 36 2.5 Netflix Content Spending ..................................................................................... 38 Chapter 3 : Data Presentation ................................................................................. 43 3.1 Introduction ........................................................................................................... 43 3.2 Respondent demographics .................................................................................... 43 3.2.1 Ethnicity and gender .......................................................................................... 43 3.2.2 Location and gender ........................................................................................... 44 3.2.3 Respondent ages................................................................................................. 44 3.2.4 Respondents with children under 16 in their household .................................... 45 3.2.5 Respondent household income in US dollars .................................................... 46 iii 3.2.6 How respondents paid for Netflix access ........................................................... 47 3.3 Netflix usage ......................................................................................................... 48 3.3.1 Total respondents’ frequency of Netflix streaming use ..................................... 48 3.3.2 How long ago respondents first used Netflix streaming .................................... 49 3.3.3 Frequency of Netflix streaming use arranged by how long ago Netflix streaming was first used............................................................................................................... 49 3.3.4 Frequency of use for children under 16 in respondent’s household .................. 50 3.3.5 Why respondents first began using Netflix ........................................................ 51 3.3.6 Why people began using Netflix arranged by frequency of use ........................ 52 3.3.7 Why people begin using Netflix arranged by first use of streaming ................. 53 3.3.8 Reasons for suspending Netflix usage ............................................................... 54 3.3.9 Reasons for rejoining Netflix ............................................................................. 55 3.4 Usage and Opinion of Other Content Sources ...................................................... 56 3.4.1 Number of premium content services used in addition to Netflix ..................... 56 3.4.2 Which other premium content services respondents used ................................. 57 3.4.3 Percentage of users subscribing to other content services arranged by first Netflix streaming use .................................................................................................. 58 3.4.4 Percentage of respondents subscribing to other content services arranged by streaming frequency .................................................................................................... 59 3.4.5 Respondents’ opinion of premium content providers ........................................ 59 3.4.6 Domestic respondents’ opinion of broadcast and basic cable content in comparison with Netflix ............................................................................................. 60 3.5 Viewership and opinion of content genre and forms ............................................ 61 3.5.1 Respondent viewership of content forms ........................................................... 61 3.5.2 How often respondents watched specific content genres .................................. 63 3.5.3 How often respondents watched specific content genres by gender.................. 64 3.5.4 Whether or not Netflix needs to add additional content to its catalog by content forms ........................................................................................................................... 65 3.5.5 Whether or not Netflix needs to add additional content to its catalog by genre 66 3.6 Respondent opinion on Netflix original programs................................................ 68 3.6.1 Respondent awareness of select Netflix original programs ............................... 68 iv 3.6.2 Respondent viewership for select Netflix originals, restricted to those who were aware of the programs ................................................................................................. 70 3.6.3 Respondents’ rating of Netflix original programming vs. entire content collection ..................................................................................................................... 71 3.7 Perceived value of Netflix streaming features ...................................................... 73 3.7.1 Importance of Netflix features and activities on a 5-point scale ....................... 73 3.7.2 Respondents’ most important feature to Netflix usage satisfaction................... 75 3.7.3 Respondents’ most important feature to Netflix usage satisfaction by gender .. 75 3.7.3 Respondents’ most important feature to Netflix usage satisfaction by frequency of use ........................................................................................................................... 76 3.7.4 Respondents’ most important feature to Netflix usage satisfaction by how long ago Netflix streaming was first used ........................................................................... 77 3.8 Importance of future Netflix original programming ............................................. 78 3.8.1 Whether or not knowing that Netflix is greatly expanding original programming adds value to Netflix access arranged by frequency of use ........................................ 78 3.8.2 Whether or not knowing that Netflix is greatly expanding original programming adds value to Netflix access arranged by how long ago Netflix streaming was first used ............................................................................................................................. 79 3.8.3 Importance of the prospect of future original programming to respondents’ continued Netflix usage arranged by frequency of use ............................................... 81 3.8.4 Importance of the prospect of future original programming to respondents’ continued Netflix use arranged by how long ago Netflix streaming was first used ... 82 Chapter 4 : Discussion .............................................................................................. 84 4.1 Introduction ..........................................................................................................
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