Did you know Netflix still ships DVDs? You could be forgiven if you hadn't even thought about it for a while. In fact, there's a decent chance you don't even own a DVD player anymore. We still have a stack of discs in our basement, but I can't remember the last time one showed up in a red envelope in my mailbox.
5,000,000,000 shipments. F I V E B I L L I O N .-- DVD Netflix (@dvdnetflix) August 26, 2019
The most heartfelt thank you to our incredible members that have been with us for the past 21 years of DVD Netflix. Five billion discs delivered is a huge milestone and we owe it all to our amazing members and team members. pic.twitter.com/Eg1bjEMtcx
What's even more impressive? The company clearly still makes money renting DVDs--though not nearly as much as it makes from streaming. There are a little over two million DVD customers and about 151 million streaming customers. But those two million will still make the company almost $46 million in profit this year.
That's not an astronomical sum of cash for a company the size of Netflix, but it's still real money. And it represents something even more significant--the company isn't afraid to keep doing what works.
Netflix revolutionized the way we watch movies (and then TV shows). Actually, it did it twice--once with its DVD rental service, and then again with on-demand streaming. Along the way, all kinds of competitors have popped up and challenged parts of the company's business. Content creators like Disney and HBO are introducing their own streaming services. Apple is getting in the original content game as well.
Being first helps. Being the biggest also helps. But being smart is even better.
While I haven't ordered a DVD from Netflix for a decade, it's absolutely smart that the company hasn't given up on a part of its business that keeps working. It helps that the loss of DVD customers has been offset by the increase in streaming customers, but still--Netflix didn't simply abandon physical discs when streaming took off.
It takes a lot of guts sometimes to keep doing what works. That sounds counterintuitive, since it takes way more guts to do something new and unproven, right? True, but the new thing is exciting, and it's easy to get pumped up for a new adventure. It's easy to lose sight of what got you here and to simply let it die--even if it's still working.
DVD rental by mail is not a growing market. It's barely even a market anymore. But the market that exists is all Netflix's, and the company continues to make money serving the (albeit small) audience that still loves going to the mailbox to find a red envelope.
Kudos to Netflix for sticking with what works, even as it has expanded into streaming, and now into original content production. That's a lesson worth considering for every entrepreneur when the new shiny thing comes along. By all means, do the new thing. Just don't give up on what is already working.