What happened to Netflix?
Small tweaks can make all the difference. Also, 7 other things worth your time.
Note from Bill: Thanks a kajillion to Kate for writing today’s big essay, as my family and I spent yesterday driving home through a veritable monsoon from New England to New Jersey.
Before we dive in, I want to make sure that our two (count ‘em, two) upcoming Understandably Live sign-up links are prominent. (Sign up, tune in, and ask questions.)
First, today at 1 p.m. ET: I’ll be interviewing Annie Korzen, famous for her recurring role on Seinfeld, for her commentaries on NPR’s Morning Edition, and, if you’re one of the more than 2.1 million people who have “liked” her videos, for being big on TikTok. As of last night when I was putting this to bed, we still have slots for this one available.
(Sign up here by 12:45 p.m. ET today, and I’ll send a Zoom link and calendar invite.)
Next: Monday, July 12, also at 1 p.m. ET: Details below, as you’ll see, but I’ll be interviewing Dr. Joel Mier, who was one of the original marketing directors at Netflix, and who now teaches at the University of Richmond’s MBA program. We’ll be talking about the recent article he coauthored on the early history of Netflix—and how it became the juggernaut it is today.
(Sign up here by 12:45 p.m. ET Monday, and I’ll send a Zoom link and calendar invite.)
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With that intro. … Heeeeerrreee’s Kate!
Twist & shout
About a decade ago, I learned firsthand what a difference a small twist can make. After a long day of skiing in Vermont, I was cruising to the lift for one last run when…
Huh. Why can’t I stand up?
Many hours later, after being sledded off the mountain, driven two hours to the nearest ER, and subjected to much poking and prodding, I learned that a tiny adjustment I’d made in how I skied—the teeny little tweak of a binding, and the twist of a knee—had resulted in the complete vaporization of several fairly important ligaments.
Not great, obviously. But this painful experience did—as so many things do in retrospect—have a silver lining. Lying on the couch in recovery mode for a while gave me some actual time to read. That ultimately led me to launch a publishing company, which, in turn, eventually led to me becoming a psychologist specializing in work and well-being.
It’s a real-life, physiological metaphor: How can a small twist lead to a big ripple effect?
In business, I’ve seen that it’s sometimes not the big pivots that are most crucial for success—going from producing gin to making hand sanitizer in the pandemic, for instance, or shifting from a sales to a subscription model; it’s the smaller ones that don’t always seem obvious.
Today’s case in point: Netflix. As Dr. Joel Mier (now of the University of Richmond, but formerly of Netflix itself) and Ajay K. Kohli (of Georgia Tech) write in AMS Review:
To the average United States resident, it may appear as though Netflix successfully made a single pivot in 23 years, from ordering DVDs online and having them delivered in the mail to streaming content on virtually any device.
But by looking deeper into the company’s detailed history, we can see that in fact the firm has made several significant and meaningful changes since its formation.
Among the less-recognized twists and pivots:
Adding subscriptions (Did you know that originally, Netflix had a more classic “video store model,” where customers rented and paid for one DVD by mail at a time?)…
Releasing content in blocks for binge-watching (this is so normalized and copied now, it’s hard to remember a time when it wasn’t a thing)…
Adding original content (really, an entirely different business than distributing content produced by others)…
And so on.
Mier and Kohli argue that it’s this willingness to anticipate what customers may want before they even have any idea, then take risks and tear up old business strategies, that have made Netflix a success. Those supposedly “small” twists and turns, when guided by smart strategy, customer value, and a certain fearlessness, add up.
As mentioned, Mier is now teaching and writing academically about Netflix, but he also worked there back in the early days, joining the company as roughly employee No. 30, he explained, and rising to become one of five or so marketing directors.
Want to learn more? We’ll be talking with Mier on Understandably Live on Monday, July 12, at 1 p.m. Eastern. Topics will include entrepreneurship, marketing in the real world, how it all affects you in the everyday—and we’ll also push him a bit on the challenges of writing an academic article about your former employer.
So: Sign up for the interview on Monday, and let’s also get to our call for comments:
What’s the big pivot you look back on that changed everything in your life or your business? Were there smaller ones that only look so large in retrospect? Leave a comment!
7 other things worth your time
President Biden said the withdrawal from Afghanistan of US troops after 20 years of war will conclude on August 31, ahead of the September 11 deadline he announced in mid-April. He also said the US government is working to relocate Afghanistan interpreters who want to leave to other countries (UAE, Qatar, and the US territory of Guam are mentioned most often), and to try to change immigration laws to allow them to settle in the United States itself. (CBS News, Fox News)
A 14-year-old named Zaila Avant-garde from Harvey, Louisiana, won the Scripps National Spelling Bee, making her the first African-American contestant ever to win. Her winning word: "murraya," a genus of tropical Asiatic and Australian trees. It’s an obscure enough word that my automatic spellcheck added a long, red squiggly line beneath it in the first draft of this item. (ESPN)
Straight out of a sci-fi blockbuster: China is preparing to launch a fleet of rockets to divert an asteroid that has a 1 in 2,700 chance of hitting Earth. (Independent)
Speaking of blockbusters, and Netflix for that matter, in one of the very first editions of Understandably ever—in fact, back when this newsletter was still called The Byliner (long story), and when the subscriber base was about 0.5% of what it is now (so I know very few of you have seen it)—I wrote about whether Netflix really killed Blockbuster, or whether Blockbuster was on its way out regardless. Spoiler alert: Probably the latter. (The Byliner)
Leading indicator: A combination of sky-high demand and disrupted supply chains have created a shortage of patio furniture. The owner of one garden supply store in Maryland says he’s waiting on a shipping container from Vietnam that is already six months late, yet he’s also already sold half of its contents “by showing customers photographs.” (AP)
Foreign tourists who are not vaccinated against COVID-19 will not be allowed to enter Canada for some time because the government is unwilling to jeopardize progress made on containing the virus. "I can tell you right now that's not going to happen for quite a while," said Prime Minister Justin Trudeau. (Reuters)
Heck of a wake up call: How would you like to find a nearly three-foot-tall African wildcat standing over you in bed? (I mean, you would not, but it’s a wild story.)(CNN)
This worked very well last week, so let’s try it again. There are three questions below. The first reader to reply via email with the correct answers to all three (just hit reply, or email email@example.com) gets a shout-out in Monday’s edition—plus, if you want it, the chance to chat with Bill and our small but growing team, and maybe pitch us an idea for a possible future main story.
Answers to all three questions can be found in this week’s newsletters. Ready?
What part of the brain controls our attitudes towards good and bad possibilities?
Which Seinfeld episode was ranked the 6th best of all time by Vulture?
Who won this year’s Nathan’s hot dog eating competition? Bonus points if you know how many times this person has won overall.
Thanks for reading. Photo credit: Pixabay. Want to see all my mistakes? Click here.