NextLeap PM Fellowship Netflix’s Declining Revenue User Journey Map Possible Solutions

Problem Analysis for Declining Revenue of Netflix, Possible

solutions & User Journey Map

By Shriansh Srivastava, a 4 minutes read

 Olympus has fallen Saving the sinking ship User Journey Map

REASONS FOR THE DECLINE IN REVENUE METRIC AFFECTED /VALIDATION OF THE REASON
Prices
• Netflix costs the highest amongst its competitors
such as Prime Videos and Hotstar in India.
Loss of subscribers due to increase in price of the
monthly subscription in various countries • Loss in existing subscribers which directly affects
Revenue
revenue
• Netflix lost more than 7,00,000 subscribers after its
Exiting the markets of Russia due to the war situation, exit from Russia because of the war situation
thereby losing customers and revenue • Loss in existing subscribers affecting the revenue
directly
• Netflix depends a lot of its original series if
Relatively narrow slice of original and licensed film and competitors like Disney and HBO continue to use
TV shows their own platform for their previous releases
• Loss in average viewing hours per users decreases

• Disney+Hotstar has captured the largest market

Competitors such as Amazon, Apple and Disney have share in a country like India due its partnership with
looked to include sports, news and light entertainment various sports boards
in their wider packages • Loss in average view through rate decreases,
affecting revenue

• Friends went to HBO Max, Parks and Rec came to

Disney and HBO are production companies have started
Peacock, which will also get The Office. Once Upon a
streaming their movies on their own platform instead of
Time, meanwhile, moved from Netflix to Disney+
Netflix increasing the churned users
• Customer retention decreases, affecting the revenue
 Olympus has fallen
Key Metrics New Subscribers
Streaming Live Sports, News and Entertainment to gain
new subscribers
• Hotstar gained massive customer base after they became official streaming
partners for IPL
• Their subscriber count surged from 8.7 mn to 45.9 mn at an astonishing
pace in less than 2 years
• Key Metric – Increase in new subscribers
Focus on Netflix Originals to avoid dependency on
competitor production houses to retain subscribers
• As per Appintentiv, 58% users in USA watch Netflix solely for their original
series. It also reduces dependency on shows of other production houses
• Key Metric – Subscriber retention is high
Venture into streaming Anime series which has a huge
fanbase for new subscribers
• Anime has a huge fanbase in the APAC region with no clear market leader that streams
Anime’s.
• Netflix can leverage in this relatively less tapped market to increase subscribers
• Key Metric – Average number of hours viewed increases, retention increases, tapping
the new market with Japanese language
Saving the sinking ship User Journey Map
Subscriber Retention Reducing Churned Subscribers
Work on how to monetize password sharing by allowing password
sharing at a little premium
• Only 55% people pay for their Netflix account
• Password sharing adds to as many as 30 mn households in North America alone
• Monetising password sharing by charging a little premium from the customers
can be another way of generating revenue
• Key Metric – Increase in revenue collected, Addition of new subscribers
Cheaper subscription model in APAC region to capture the market
share in the otherwise lesser-tapped region
• Netflix uses a different pricing model for different countries
• Most of the Netflix’s subscriber count from North America and Europe
• Focus on APAC region which is price sensitive can help them tap into these
markets thereby increasing their subscribers
• Key Metric – Cheaper prices, more subscribers, lesser fee, penetrating new
cost sensitive markets
Ad-supported Netflix for subscribers who would like to have
a lower price and are advertising tolerant
• Paid Advertisement and partnerships can help Netflix recover some revenue as
all its competitors have already relied on Ads for generating external revenue
• Key Metric – Lesser subscription fee, more new subscribers, greater
subscriber retention, lesser churned subscribers
 Olympus has fallen Saving the sinking ship User Journey Map

OPENS LOGIN/EXPLORE FINDS READS REVIEWS AND STARTS WATCHING

STAGES MOVIE/ SHOW SYNOPSIS
WEBSITE/APP PLANS

➢ Sign up/Login to ➢ Login and choose a ➢ Chooses a particular ➢ Reads the synopsis ➢ Watch their favourite
Netflix and watch a subscription plan as movie / TV show and reviews of the movie/show on
movie or a show as per the requirement available on the show/movie that Netflix
USER GOAL
per genre or mood Netflix platform user is planning to
watch

➢ Launches the Netflix ➢ Sign up with email ID, ➢ Uses the search ➢ Reads the reviews of ➢ Plays and pauses for
USER ACTION app or its website password and feature or the the show/movie all as per
payment information suggestion tiles on selected/shortlisted requirement
the landing page and its synopsis

USER EXPERIENCE

➢ Landing page asks to ➢ Process of paym ent is ➢ Recommendation of ➢ Reviews available are ➢ Requires high
sign up/login without hassled, with only a few shows are a bit short, no links to bandwidth of internet
STRUGGLE POINTS showing the relevant cards being accepted, haphazard and at times websites such as IMDB, and streaming
shows. Preview of no direct sign up with clumsy for users casually Rotten tomatoes for suffers otherwise
service missing google/apple browsing user to navigate

➢ Landing page should ➢ Allow sign-up/login with ➢ Focus on Netflix Originals, ➢ Include links for various ➢ Optimise the streaming
google, make the new releases, previously review websites for which allows users to
be where all shows are users to navigate and
PROPOSAL payment hassle-free by watched genre along with adjust the video quality
listed and suggested multiple payment recommendation as per watch the review of the
with a pop-up to sign- as per the bandwidth
options apart from location of the user show, allow users to
up/login cards write reviews/rate of users