Winning products are first-in-mind because they have a solution so good, that it’s indistinguishable from perfect. When in DVDs, Netflix was a winning product because it solved the problem of watching videos at home, without going to a store or paying late fees.
When they went into streaming, they solved the same problem more ideally. A seemingly infinite, ad-free library of content to watch for the price of a single rental.
Netflix isn’t a winning product today, because it’s not first in mind. There are many other products that come to mind when solving this problem. HBO, Disney, Hulu, Prime are all solving the problem just as well.
To dethrone a winning product, you have to create a solution as good or better than them (the product), which solves a problem for the same amount of people (or more).
To take back its winning status, Netflix would have to do the same. Either create a solution that’s—roughly 5x—better than their competitors. As they did with the DVD service and Blockbuster. Or, find a larger audience for their product.
Netflix single primitives and their simplicity history
Using a single primitive is one of the two design rules for winning products. Netflix applies this rule. The simplicity of the single primitive helped drive their innovation, twice.
When Netflix was shipping physical content, the single primitive was the DVD. This made it easy to communicate and understand, “you get 3 DVDs a month, keep them as long as you like”. DVDs were also flat and easy to send in the mail. The simplicity of using a single primitive (the DVD) and not adding VHS, was key to them winning.
When Netflix began to focus on streaming. They cut a new path. Riding the wave of increased bandwidth and cord-cutting. The primitive here was simply the title, the rectangular tile that represents a movie or show you go to select in their product. Even today the Netflix product remains simple without forking your paths (making you choose between TV or movies), increasing the friction for you as a user, and making it less likely to become first-in-mind.
The product (select any type of content, stream endlessly using the internet), and the model (spend upfront to buy and produce original content) have been copied by well-funded competitors.
Netflix has tried some other new things, like completely interactive choose-your-own-adventure-style content. They’ve also gone vertical in some areas, like making a video game for Stranger Things. Netflix has a history of re-innovating, and they could do it again. It’ll be interesting to see the creativity that comes out of this space, what’s next, and who wins.