Netflix is a media-streaming platform that has taken over not just the digital content markets, but the entire entertainment industry. Over the past few years, especially during COVID-19, Netflix has achieved rapid success and reached over 214 million subscribers in 2021. Whether it is Money Heist, Lupin, or Squid Game, people are getting obsessed with Netflix’s original series. Squid Game has broken all previous records and is expected to get around $900 million in business for the company.
Netflix is available around the world except in China, North Korea, and Crimea. The story of Netflix’s viral success offers some significant insights into localization. It is not just the amazingly produced content that sets Netflix apart, but there is certainly more to the success of the company. The effective global market strategy, along with localization efforts, worked phenomenally well for Netflix, and they managed to achieve global success.
So, what exactly convinced millions of people around the world to buy Netflix subscriptions? Why do they choose Netflix over free content available on other media streaming channels? Is there any chance for Netflix to totally replace cinema anyway soon?
These are quite debatable questions, and the answers can shift the paradigm of the entertainment industry for good. So, let’s dig deep into the localization strategy of the company and what makes their globalization plan impressively dominate the streaming empire. This blog is a case study on Netflix’s localization plan that would make you understand the role of localization in your business expansion plans.
Netflix – A Case Study on Globalization
Netflix has become quite an obsession. This streaming platform has totally revolutionized media consumption. Undoubtedly, they are offering the best content, but there are also some other factors that make Netflix successful. Smart branding and an effective localization strategy have allowed the company to target vast audiences globally.
Knowing Netflix’s business and its globalization strategy can help global companies pull off their growth goals.
A Brief History of Netflix Business
Netflix Startup
Most people, especially those outside the United States and Canada, have not heard about Netflix for many years. However, it has been around for decades. Netflix was founded in 1997 as a DVD rental business. Customers had to pay online for the disc they wanted to rent and receive it through the mail. After 3 years of launch, Netflix changed its business model to monthly subscriptions with no loan fee, rather than going any further with the rental pricing model. This model also cut the cost of DVD shipments.
Initial Competition
The biggest competition of Netflix when it launched was Blockbuster. It was a global video company that offered videos on rent in stores. But unlike Netflix, it takes them a lot of years to shift their rental business model to a video subscription platform. In 1999 when the company first shifted to a subscription model, in the first year they had only 239 subscribers. Their customer base continued to grow, and by 2003 they crossed 1 million subscribers. Even at that time, Netflix was the best online movie and series service provider.
Transformation To a Streaming Platform
It didn’t take Netflix long to understand that their rental business model was not going to take them any further. They must make good use of emerging internet technology to enhance customers’ convenience. From rental DVD business to online monthly subscription, the company carefully analyzed the market demands and changed the business accordingly. In 2007 the company first introduced its streaming services, which proved to be a turning point for Netflix. There was a drastic change in customers’ media consumption preferences, shifting from watching DVDs to streaming movies.
International Expansion
This new business model of Netflix opened up new opportunities for international growth. The online streaming business allows the company to operate in global markets and target wider audiences. Starting from Canada, Netflix gradually moved its business to Latin America, the Caribbean, and then other continents. In just 3 years of the global expansion plan, Netflix had its business running in around 130 countries.
By the time the company reached 190 countries, it had around 2/3 of total subscribers outside Canada and the USA. The effective globalization strategy and local-focused approach accelerate their business growth. Currently, Netflix is valued at somewhere around $289.09 billion with around 214 million subscribers paying a subscription fee.
Netflix’s Best Localization Practices
They Started Slow
People still consider Netflix a rapid success, but they have walked a long road to success. They started slowly and made all the growth decisions mindfully to avoid business mistakes. Considering the cultural characteristics and demands of each market, Netflix made its marketing localization strategies accordingly. Initially, they targeted the less challenging cultures and gradually moved to more difficult ones. Netflix started with geographically closer countries, so they have to struggle less because of similar cultures. They kept on understanding the cultures, markets, and public dependencies and perfected their localization strategies. They knew their customers, they knew the cultures, and they deeply understood people’s psychologies which helped them grow their business, even in diversified cultures like Japan and India.
Although the competition is intense and there are many other companies operating in the streaming industry, Netflix has managed to make its place high among other competitors.
Language Comes First
Studies have proved that a brand that speaks the languages of native customers is more likely to succeed in that region. Speaking your customers’ language is the most effective way to connect with them. Netflix is one of the first companies that seriously realized the significance of language services and gave a boost to the translation industry. This reflects their core understanding of movie streaming consumption around the world. The company knew that if they wanted to thrive in the entertainment and streaming industry, they have to put the language first. When watching a movie in your foreign language, subtitles and dubbing enhance the viewer’s accessibility to a story. It also helps the company to make the content more culturally appropriate.
For every movie, documentary, and season, they provide subtitles and dubbing based on your location. In some countries, Netflix prefers dubbed content over subtitles to achieve the best localization results. To keep the translation’s tone authentic, Netflix has adopted the A/B testing approach. Creating a high-quality translation was not an easy task for Netflix. Even though it is a big company, the workload of translations is always high, and professional translators are never enough.
Bypass Traditional Gatekeepers
Netflix makes very good use of internet technology to overcome the other traditional competitors like Hollywood. Whatever content you watch on Netflix does not always come from Hollywood. They are also supporting local content creators from different domains, be it documentaries, seasons, or cinematic movies. They localize their content putting the language first by adding subtitles and dubbing. It has helped the audiences better connect with the stories being told.
Netflix has also developed a multilingual SEO strategy to make its content more visible on search engines like Google. It makes it easier for not just customers, but also content producers, to reach Netflix. Now, it can be said that Netflix has become a parallel entertainment and video content production industry to Hollywood.
Adapted Cultures and Values
From movie recommendations to overall interface design, the way content is displayed on your Netflix account is not the same for people living in other cultural zones. The company takes into account your personal preferences, cultural values, and languages and presents you with the most relevant version of the home screen tailored to users’ interests. Realizing the importance of localization, the company has modified its product for all regions globally.
This helped their audiences resonate with their content and better connect with the brand. Based on the diversified values and distinct cultures of every region, you have to adapt the content accordingly. Modifying the content to the preferences of every region and every user is a big challenge, though. Because there are hundreds of languages and cultures around the world. Well, localization is not just about movie suggestions and user interface, it is more complicated than that. For this, they have designed powerful algorithms and used different techniques to make it happen for every region.
User Interface Design
Designing an interface, to efficiently display all the content, was a major challenge for the company. Over time, Netflix has perfected its display and improved the user interface design. They do pseudo-localization to make it easier for the localization teams to adjust the content for every region. You have to adjust the design to the translated languages. For instance, if the text is to be translated from English to Chinese, the spacing is adjusted accordingly. Similarly, if you translate from languages that are right to left, you must modify the layouts of the interface.
In one of their articles, Netflix talks about the technical issues that they face every day while updating and adjusting their content to local audiences. There are a lot of things localization teams have taken into consideration:
- Horizontally and vertically presented text.
- Left to right and right to left scripting languages.
- The spacing limitations of characters. Some languages take up more space than others do. It is an important thing to consider while translating the content. Otherwise, it’ll create a lot of mess on the screen.
- Similarly, the content translations for buttons, descriptions, and titles might not fit into the space. So, it is significant to make an adjustment to the layout as you translate the content.
- The character size, formatting, buttons, and fonts; you have to modify all the elements for every new region, or it can lead to many cultural and technical deficiencies.
Qualified and Experienced Professionals
Netflix created the best team in the world to effectively manage localization projects and ensure the quality of translations and dubbing. From expert linguists to talented developers, there are qualified professionals who manage the localization tasks. They have organized their teams smartly to deal with tons of localization projects on time and avoid delays. Every localization project is further split into different tasks; the project managers and directors, leading the projects, are responsible for managing the operations.
Multilingual content localization is quite a job for the company, and to make it happen they need a lot of translators, native speakers, and expert linguists. As far as content translation is concerned, they are not totally relying on in-house teams, but also have partnered with language service providers and freelance translators to manage their workloads. Netflix is dedicated to technological development, and smarter project management to smoothly handle their day-to-day operations.
Creative Freedom
Netflix has brought many local production companies on board and presented their content through its platform. It is possible for the company to offer Hollywood-level budgets to foreign production houses that would be otherwise impossible for them to get. The important question to consider here is, who would have the creative control, and how this investment can influence the creative process behind the scenes.
There are content creators who claim to be under a lot of pressure to make their stories accessible to the world’s population. It was never like that before. Netflix does offer advice when it comes to enhancing the accessibility of a story to global audiences, but they never hold the creative gear in their hands. They believed in offering complete freedom to creators, so they could shape their stories as they wanted. The company has never forced changes on producers. According to an actor performing in Manga, Netflix gives creators a lot of money and little direction.
Netflix has been criticized and praised at the same time for its anime production, because of its diversification from traditional made Japanese anime. It also gave the opportunity to Japanese producers to tell their stories to wider audiences internationally.
Wrapping Up!
Summing up the whole discussion, we can say that localization is a big contributor to Netflix’s success. Netflix is a great example for companies that want to push the envelope and expand their businesses to global markets. The company has been very effective in localizing its global marketing strategy to the specific needs of every region. Without local-focused content, they might never be able to target international audiences. This case study on Netflix’s business and localization journey would help you understand the significance of translations and culturally appropriate content to enable the global expansion of any business.
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