Netflix has just announced that it will increase it’s marketing budget to $2 billion this year. Their budget last year was $1.3 billion. Netflix = one of the largest media streaming companies in the world. And they’ve decided to pour $700 million more dollars into their marketing budget. MILLION.
That’s a lot of money for marketing. And this is Netflix; it’s safe to say they have a pretty large customer base. They could probably get away with dropping their marketing altogether and coasting solely on great product and customer loyalty.
But Netflix realizes the importance of good marketing. Founder and CEO Reed Hastings has said,
“we’re always also trying to improve the product and the
organic reach, social and PR of the title marketing, where you
end up having to spend less on paid marketing.”
This is advice from an industry leader. Netflix, a market value of $100 billion, is saying that good marketing should be a primary goal for long term benefit. Hastings also says the media company is increasing their marketing spend faster than they are increasing revenue. Why would a company take a gamble like that?
Because Netflix knows good quality marketing pays off.
Good, quality marketing is the only kind that works. There is no getting around that. The problem is that most companies do try and get around it. Everyone likes to cut corners. Everyone likes to save money. That’s human nature. But certain things you can’t afford to cut corners from. If Netflix had decided to short their marketing budget, they certainly wouldn’t be where they are now.
Companies often make the mistake of delegating too much of their budget to other areas, like customer service or human resources. And then they let their marketing fall to the wayside. This is a huge mistake. Your marketing is essentially the lifeline of your business; it’s what gets it moving. If your product is the wings, your marketing is the wind. You might be running a solid business but if nobody knows about it, good luck keeping it alive.
You need to invest in a strong marketing strategy. All good investors know you get what you pay for. If you truly designate the time and funds to your marketing, who knows, you could rise up and become one of Netflix’s top competitors. And we hope that when you DO get there, you remember this basic business lesson: your marketing is always worth the investment.