When Stranger Things debuted on Netflix, Inc. (NASDAQ:NFLX) in July 2016, it was a breakout hit and became one of the most streamed shows of the year. The series, which combines horror with a nostalgic view of 1980's pop culture, was lauded by fans and critics for combining a gripping story with compelling characters.
The long-awaited release of Stranger Things 2 in late October carried on in the tradition of its predecessor and recreated the buzz that made the original a smash hit. It captured a 95% Fresh on review aggregation site Rotten Tomatoes and also garnered massive social media attention ahead of its release.
Buzz-worthy shows are one of the key drivers of new subscribers for Netflix, and its record of creating and acquiring noteworthy programming shows why the streaming pioneer will continue to succeed.
The secret to its success is no secret
This isn't the first time Netflix has released a show that captured the public imagination. In 2015, Making a Murderer created similar buzz. The documentary chronicled the case of a wrongfully convicted man, who was exonerated and subsequently charged with another murder, seemingly to prevent a wrongful conviction lawsuit.
13 Reasons Why, based on the international best-seller of the same name, revolves around the suicide of a teenage girl, and became a national talking point on the subject. At the time, it became the most tweeted-about show of the year.
Continuing a proud tradition
Stranger Things 2 not only received rave reviews but generated a staggering amount of social media attention. According to audience insight company Fizziology, the program "broke the internet," garnering over 670,000 unique mentions across social media sites Facebook, Twitter, Instagram, Reddit, YouTube, Tumblr, and Weibo in the 24 hours following the shows release. This represented a 3,800% increase from the first season.
It also became the most tweeted-about streaming debut so far this year, garnering a massive 1,043,257 mentions on Twitter in the 48 hours following its premier. This topped other buzz-worthy choices like The Handmaid's Tale and Orange is the New Black.
Netflix doesn't release viewership numbers, but social media buzz and positive reviews can give us an idea of a show's popularity. Based on these numbers, Stranger Things 2 is another smash hit for the company.
It isn't just consumers that are sold on Netflix
Subscribers aren't the only ones making the move to Netflix. Veteran TV producer Shonda Rhimes, best known as the creator behind such hits shows as Grey's Anatomy and Scandal, recently signed a multi-year deal to produce shows for the streaming service, boasting the "clear, fearless space for creators at Netflix" and that she found "the opportunity to build a vibrant new storytelling home for writers with the unique creative freedom and instantaneous global reach."
Director and screenwriter Dee Rees expanded on the theme, explaining why she was "relieved and overjoyed" that her film Mudbound was acquired by Netflix. "I think the other studios were afraid of this film, they didn't want to touch it," Rees said. "Netflix has been extremely supportive of me as an artist. I've never felt more supported in terms of the marketing of the film and having a voice... I think Netflix is going to be the place for edgy, challenging content. It's going to be a place for auteurs."
Creative freedom is an often cited reason why artists prefer the Netflix model and are able to bring their visionary works to fruition.
Why it matters
In second quarter 2017, Netflix revealed just how important its original content, and particularly these hit shows, are to its success:
In Q2, we underestimated the popularity of our strong slate of content, which led to higher-than-expected acquisition [subscribers] across all major territories. As a result, global net adds totaled a Q2-record 5.2 million (vs. forecast of 3.2 million) and increased 5% sequentially, bucking historical seasonal patterns.
Record subscriber counts lead to greater financial results. In its recently completed third quarter, Netflix revenue jumped 30% year over year, to $2.95 billion and its contribution profit vaulted to $679.4 million. The company added a record 5.3 million new subscribers and is forecasting 6.3 million new customers for the coming quarter.
Focusing on creating quality original content like Stranger Things is paying off in terms of greater subscriber numbers, which results in improving financials. Investors need to hold on. This is going to be a great ride.