Netflix has changed the way that consumers view television and film. The distributor has rapidly grown to become the most popular source for both physical DVD rentals and online streaming video, otherwise known as VOD (video on demand). Some of its' competitors, such as Amazon, have recently began to challenge their unprecedented model, but Netflix still dominates the market with the most subscribers and monthly viewership of over a billion hours of content.
In July of 2012, Netflix CEO Reed Hastings decided to share this information with the public via Facebook. This caused their stock to spike and created a lot of buzz, even prompting the SEC to consider facing charges. While they decided not to file suit, Netflix continued to push the boundaries, sharing information with consumers that some companies attempt to keep under wraps. They set a new standard for openness and honesty that enhanced their credibility with their customers.
Beyond this, Netflix is utilizing social media to share information with customers that would traditionally be released through more formal proceedings. Instead of the traditional earnings call, Netflix had opted to share its Q2 earnings as of 2013 through a video conference. They continue to use Facebook and other online platforms as their communication method of choice. In a company so focused on digital platforms, it only makes sense that they would utilize all forms of digital communication to their benefit.
Netflix succeeds because it recognizes where its' audience is and connects with them socially.
For popular shows like House of Cards, Netflix turns to social media to gather valuable information about what subscribers are buzzing about and where there is a need to be filled in television watching. They decided to use the model of “binge-watching” by releasing their seasons in their entirety at once since customers were sounding off about their viewing preferences. They also used Twitter to monitor analytics from various Twitter posts and gain insight on viewer patterns and likes/dislikes that could not be gained simply by analyzing their own website’s traffic.
No matter what the industry, all businesses should use this as an example of effective communication through social media. The companies that are gaining traction in today's world are those that use social media and technology to their full advantage as it will only continue to grow in usage and utility.
Netflix has become an example for the kind of transparency and connectivity for both consumers and investors.