Just over a week ago, Green Book took home the Oscar for best picture and best original screenplay. But underneath the awards, there was an even bigger winner – Netflix.
Throughout the night, Netflix secured award after award, taking home a total of four Oscars at the 2019 Academy Awards: three for the visceral and moving ’Roma’ (Best Cinematography; Best Foreign Language Film; and Best Director) and one (Best Documentary Short) for ’Period. End of Sentence’. These were not Netflix’s first Oscar wins. The streaming service won Best Documentary Short in 2017 for “The White Helmets” and Best Documentary Feature in 2018 for “Icarus.” But this year, Netflix got its first wins outside the documentary categories, and grabbed two of the ‘biggies’ – Best Cinematography and Best Director. This could be a similar milestone as Netflix achieved with TV Series, which generated not only several Emmy wins, but more importantly transformed perceptions of Netflix into a home for original content. It also, not co-incidentally, helped drive subscriber growth and dramatically increase their stock price.
Netflix has stepped into big shoes, and it has filled them. But what are the next key milestones for Netflix?
As market leader, how do they stay on top? How do they protect their business model as competitors gain ground? Amazon Prime, HBO, and now Facebook Watch. By the way, Amazon Studios won their first Oscar in 2017, for Original Screenplay and Best Actor (“Manchester By The Sea”), and Foreign Language Film (“The Salesman”).
Should they try to jump from Clicks to Bricks?
It’s possible, and Netflix are looking into new strategies that encompass cinema streaming in order to protect their current business, build a stronger value proposition and differentiate themselves from big competitors.
We have already witnessed other digital giants such as Amazon and Alibaba successfully jump from the digital to the offline world…. Could we soon be attending a screening at a Netflix Cinema? Well, yes. And it’s not as crazy as it sounds.
Netflix’s model over the last decade is a prime example of how disruption can lead to success, and even topple a king, in this case, Blockbuster. HMV’s recent collapse has also been pinned on streaming services. But as competition grows, can Netflix continue its path on a subscription only online business model, or will they have to explore new avenues, such as physical cinemas?
The idea is not a concept, but actively becoming a reality. Roma was released in theaters in November 2018, three weeks before it became available on Netflix, an unprecedented move for a company that has traditionally eschewed the idea of releasing movies in theaters before they are available to subscribers on its streaming platform. Facing rising competition from Disney and other media giants, Netflix is increasingly eager to lure filmmakers who want their movies to be shown on a big screen and get awards recognition. Last Sunday was a great milestone, a triumph for a company that craves the same credibility in the movie business that it has achieved in television, having become a fixture in the top Emmy races.
Last year, rumors spread that Netflix executives considered acquiring Landmark Theatres. Although no cinema deal materialized, the idea of Netflix buying a theater chain would mark a new phase in the company's rapid ascent to become one of the most powerful players in the entertainment industry. Today its movies are locked out of major theater chains, and have been effectively blocked from one of the world's most prestigious film festivals: Cannes.
Owning a theatrical outlet would give Netflix a boost for awards consideration and make it more attractive for filmmakers who still want to see their movies play on the big screen. No filmmaker says, “Yeah, I want to make a movie for an iPad. They want people to see it on the big screen, and rightly so,” said Karie Bible, Box Office Analyst at Exhibitor Relations Co. Inc. So it seems that Netflix has now to face what to do? How to protect their 139 million paying subscribers from the rest of the digital platforms. Should they expand their focus from the digital realm and explore the physical world?
To answer that question, let´s explore Jeff Jarvis and his book called “What Would Google Do?”. In the book, he argues that companies and individuals should study and perhaps copy Google's methods for succeeding. Why is Google opening pop ups in New York and other key cities? Why do digital companies such as Apple have stores in the main cities of the world? Why is Amazon opening shops?
Because they know that the secret ingredient to success lies in developing and nurturing customer experience. Provide great customer experience, and loyalty will follow.
So opening cinemas is not only about unlocking the opportunity to win Oscars or attend prestigious festivals, it is also about maintaining their current millions of subscribers and keep their loyalty. The famous marketer Seth Godin distinguished between proximity and Intimacy when he said, “physical proximity is one thing, but connection and intimacy come from eye contact, from hearing and being heard, from an exchange of hopes and dreams.” The digital world brings proximity because by eliminating the barriers of space but rarely creates memorable interactions. It is very convenient to watch a film anywhere you wish; on a plane, at home, at Starbucks…. but in the digital world, it is difficult to be remarkable as well as relevant and to build strong loyal relationships between customers and suppliers. If you have a beautiful and comfortable cinema theater where even millennials wish to go…the magic starts…is there any better place to dream than a cinema?
We have already seen other digital giants such as Amazon and Alibaba jumping from Clicks to Bricks…… are we going to see soon Netflix Cinemas? Or maybe Amazon will make the move first to keep expanding their ecosystem. For sure they would create more than a movie theater, for instance another place for their customers to drop off returns and pick up their order or other complementary uses and certainly they will create a new kind of theatrical experience, not just with better seats and better food, but other kinds of and of course, who would need a MoviePass? Imagine adding free movie tickets, especially for Amazon Studios films, to the Prime bucket of content and services…. maybe a kind of “Cinema GO”?
