You are the Product Manager at Netflix. What will be the top 3 metrics you will focus on and why?

CQ:

1. Goal -> engagement and monetization -> focusing on engagement as this would also drive the monetization of the platform

2. Lines of business -> Series, Movies, Documentaries

3. Geography -> Worldwide

4. Platform -> Agnostic

 

User Cohort:

1. Video producers

2. Consumers -> prioritising for these as users would have most impact

3. Sponsors

 

Journey for the user (consumer) -> Log In -> Search or browse through the videos -> Video watched, drop, partial watched -> update likes, comments -> Payments etc.

 

Top 3 Engagement Metrics:

1. Number of videos watched/30 day active user (min 30% -> with the assumption that people have limited time so either they would finish one movie in multiple sessions or if didn’t find a movie good then drop and might watch another one)

2. Hours of Videos watched/30 day active user

3. Reactions/movie

 

Lets additionally cover retention metrics if the time permits:

1. Monthly churn rate (users who become inactive after every 30 day interval)

2. Reactivation rate (% inactive users who become active)

3. #Repeat movies watched by existing customers/#videos watched by new user acquisition -> this ratio should be more than 1

 

Monetization Metrics:

 

1. % users in monthly, yearly plan

2. % users in mobile only vs web platform

3. Average revenue per active login id

Netflix is one of the most popular online content streaming applications globally. The goal of the product is to provide high quality entertaiment content in the form of TV Shows, Movies, Documentaties to it's viewers.

Netflix is a mature product with a large user base, so the focus will be on engagement, retention and monetization.

Netflix would definitely want their existing user base to actively engage with the product and would want the engagement to keep increasing.

Likewise, Netflix would aim at retaining these highly engaged users and finally would want to either convert these to paid users or ensure that the already paying users continue to remain on a subscription plan to enhance the customer lifetime value.

Engagement Metrics

1. Average hours of content streamed per user per day

2. Average hours of content streamed per user per week

3. Breakdown of hours of content consumed per category (Movies, Shows etc) per week

4. % of users who watch atleast 1 hour of content everyday.

5. % of users who watch atleast 5 hours of content every week.

6. Average session time per user per day

Retention Metrics -

1. Monthly Churn Rate

2.WAU/MAU

Monetization Metrics -

1. MRR

2. Average revenue per paid user

Out of these I would select

1. Average hours of content streamed per user per week - Considering Netflix is a weekly usage product, the aim should be on growing this metric to improve engagement

2. WAU/MAU - This metric tells us stickiness among Netflix users. Improving this will improve retention, and eventually engagement

3. MRR - Netflix offers monthly paid plans for its subscribers, so MRR is a good indication of how many of its paid subscribers chose to remain on the subscription plans.

About netflix - Netflix is a subscription-based video streaming service for watchers

 

My approach will be to: 

• Define the business goal from Netflix’s mission 

• Break down the actions taken by users at each stage of the customer journey 

• Set metrics for each user/stage Define 3 main metrics

 

The mission of Netflix is to entertain the world by providing exclusive and engaging streaming content to it’s subscribers

 

Goal - I think their goal is to engage more and more people and earn money to invest in services to engage more people on the platform (Engagement and revenue is the main goal of netflix)

 

User Actions

• sign up for the free period

• scroll recommendations

• search for something

• watch video/trailer, recommendations, collections

• create lists

• download

• subscribe for new upcomings

• come back next days

• open notifications

• subscribe for the paid version

These actions will fall under certain Mertic which are as below - 

 

Acquisition & Activation

• sign up for the free period

• scroll recommendations

• search for some content

Engagement

watch video/trailer, recommendations, collections

create lists

download

subscribe for new comings

Retention

Come back next days

open notifications

 

Conversion/Monetisation

Purchase subscription

Renewing subscription

Now as per the goal engagement and revenue are the key metrics so I would list down top metrics in this category

1. Average watch time - Time spent on the platform by users/day This metric tells us how successful we are in entertaining users

2. DAU - Active users (who watch video/trailer, recommendations, collections -create lists -download -subscribe for new comings)  

3. No of total subscribed users

4. Customer life time value (CLV)

5. No of renewed subscription

6. New V/S renewed subscription

7. Average session duration per user

8. No of session per user 

9. Notification CTR

 

Out of these i believe first three Avarage watch time , DAU and No of active subscribed users will be first north start for netflix as these are more aligning with its goal