Binge Drops Increase Churn; Drip Models Boost Retention

Key Quotes

"The strategy of releasing an entire season at the same time has been key to taking Netflix from a little startup that used to lend us DVDs in the mail ... to a company so big and powerful, it is maybe going to buy Warner Brothers and own Bugs Bunny and Tony Soprano and the Harry Potter movies."

This quote highlights the transformative impact of Netflix's "binge drop" strategy. The author argues that this approach was instrumental in Netflix's growth from a DVD rental service to a media giant capable of acquiring major entertainment assets.

"i think netflix kept us on the air not only are we standing up here with the emmy i don't think our show would have even lasted really"

This statement, attributed to show creator Vince Gilligan, underscores the critical role Netflix played in the survival of "Breaking Bad." The author uses this to illustrate how Netflix's acquisition and promotion of existing shows, enabling binge-watching, could significantly impact a show's longevity.

"instead of releasing a new episode every week the streaming service is giving subscribers entire season of house of cards all at once yours evers is a spokesman at netflix and he says ceo reed hastings believes the traditional tv model doesn't reflect modern viewing habits as reed hastings wrote imagine if books were always released one chapter per week but suddenly somebody flips a switch and you can read the whole book at your own pace that's the future of television and that's what we call internet tv"

This quote captures the revolutionary nature of Netflix's decision to release the entire first season of "House of Cards" at once. The author points out Reed Hastings' comparison to reading an entire book, framing this as the dawn of "internet TV" and a departure from traditional weekly episode releases.

"what we found was that the people in this segment were subscribing the product 50 more than everybody else 50 more 50 more than everybody else so meaning they would continue the subscription at a at a rate that was 50 higher than everyone else and uh everyone else being the people that were given all episodes of the shows at the same time"

Professor Pedro Ferreira explains the findings of his research, indicating that a weekly release model ("drip") led to significantly lower churn rates compared to binge-dropping entire seasons. The author highlights that this suggests a weekly release strategy can retain subscribers at a much higher rate.

"the thing about the end of appointment viewing is kind of prescient the thing about you can watch these in any order is really strange you could watch them in any order i mean you can it's a free country but like do whatever you want but even the the interface like just that you go chronologically like it's not a choose your own adventure you know it's not supposed to be something like formal experiment in like television"

This quote reflects on the commentary surrounding the release of "House of Cards." The author notes the prescient observation about the end of "appointment viewing" and the strangeness of the idea that viewers could watch episodes in any order, while also pointing out that the interface still guided viewers chronologically.

"it's possible that netflix is playing a longer game here offering the possibility to binge to everyone also has probably this goal of converting more and more of us into bingers and it takes time but if every one of us becomes a binger and you're the platform that is providing binges then guess where people are going to go"

Pedro Ferreira speculates on Netflix's continued commitment to the binge model. The author interprets this as a long-term strategy to cultivate a generation of binge-watchers, positioning Netflix as the primary provider for this viewing habit and thus securing future subscriber loyalty.