Recently Netflix reported that there will be an increase in the value of their plans and many people have threatened and canceled their subscription. But the question that doesn't want to be silent is the following, with this loss of customers due to the adjustment in value, will Netflix go bankrupt?
Even before announcing this increase, Netflix already expected a partial loss of its customers, that is, it was all calculated. However, this adjustment should not negatively affect the company's revenue and profit, to tell you the truth, the opposite should happen.
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Netflix's Rising Value Should Bring an Increase in the Company's Revenue and Profit
As we know, the values of the netflix plans will now vary between R$ 25.90 and R$ 55.90 and if you are a fan of the company, calm down… of Netflix will not go bankrupt the company goes bankrupt.
Some experts speculate that the following should happen, there will be a drop in the number of subscribers, but in return, the company will grow even more financially. And this should also generate an increase in investors as they will stop looking at subscriber growth and pay more attention to the company's revenue and profit metrics.
I will cite here now an example in practice, let's say that 10% of current subscribers cancel their subscription (I consider a high number by sign). That is, for every thousand people who paid R$45.90, netflix will lose 100, so we have 900 paying R$55.90.
One thousand people times R$45.90, Netflix was billing around R$45,900.00, with nine hundred people paying R$55.90, that number will rise to R$50,310.00. Anyway, we know very well that Netflix doesn't have just a thousand subscribers but millions, think about the increase in revenue that will happen.
Netflix and Its Strategy for Getting Lots of Customers
We know that this increase in the value of Netflix's plans will most likely not make the company bankrupt, but now we will talk about another subject. I am referring to the company's strategy to achieve a frightening growth in its number of customers in a few years.
She heavily used the mental triggers from Reciprocidade and Isca, whoever is in Digital Marketing has already begun to understand what I am talking about. I don't know if you remember, but the company offered a free month for the person to watch and then pay a symbolic value at the time.
Isca Digital enters as a free month to consume all the content on the platform. Reciprocity, on the other hand, is the human being's feeling of being reciprocal, and thus contracting one of the company's plans.
And this value was extremely low, if I'm not mistaken it was only about 30 reais at the time, I'm not really sure. And the result of this strategy was the great financial scalability that the company has achieved today.
Will Netflix go bankrupt?
As much as many may start to think that with this Netflix will go bankrupt, it is not possible for something like this to happen. After all, readjustments are normal to happen in plans like these, and it won't be one that will cause Netflix to lose subscribers to the point of declaring bankruptcy.
For Netflix to go bankrupt, it takes much more than that. The scenario of losing subscribers is common, and it is expected to happen thanks to the wide variety of new streaming platforms emerging. The increase may only have contributed to this, after all, paying a high price for a plan and trying others at the same time weighs on your pocket.
Over time, these lost subscribers may or may not return, but that alone is not an indication that Netflix is going out of business.
