As a Netflix Product Manager, how would you improve the Netflix subscription model?

Certainly, I'll provide a detailed, strategic answer to the question about improving Netflix's subscription model from the perspective of a seasoned VP of Product. I'll structure the response as if I'm directly addressing the interviewer in a first-person perspective.

Introduction

Thank you for presenting this intriguing challenge regarding Netflix's subscription model improvement. As we explore this strategic problem, it's crucial to consider Netflix's core objectives: maintaining market leadership, driving subscriber growth, and enhancing user engagement and retention. I'll approach this by analyzing our current position, exploring market dynamics, and proposing strategic initiatives to evolve our subscription model. Let me outline my approach:

1. Clarify strategic goals
2. Analyze market and competition
3. Define product vision and roadmap
4. Prioritize initiatives
5. Develop execution plan
6. Establish metrics and KPIs
7. Address risks and contingencies

Let's begin by aligning on our strategic objectives.

Step 1

Clarify the Strategic Goals (3-4 minutes)

• Based on Netflix's position as a streaming leader, I'm assuming our primary focus is on retention and ARPU growth rather than pure subscriber acquisition. Could you confirm if this aligns with our current strategic priorities?

Why it matters: Determines if we prioritize customer lifetime value over new subscriber growth Expected answer: Focus on retention and ARPU growth while maintaining steady subscriber growth Impact on approach: Would emphasize personalization and value-added services to increase engagement and reduce churn

• Given the maturity of the streaming market, I'm curious about our product lifecycle stage. Are we in a mature phase looking to innovate, or still in a growth phase in certain markets?

Why it matters: Influences whether we focus on incremental improvements or disruptive innovations Expected answer: Mature in developed markets, growth in emerging markets Impact on approach: Would suggest a dual strategy focusing on innovation in mature markets and expansion in growth markets

• Considering the diverse global user base, how granular is our current segmentation approach? Are we targeting specific user personas or broader demographic groups?

Why it matters: Determines the level of personalization and localization needed in our subscription offerings Expected answer: Broad demographic targeting with some regional customization Impact on approach: Would propose more nuanced segmentation and personalized subscription options

• In light of recent industry shifts towards ad-supported tiers, how open is Netflix to exploring hybrid monetization models beyond pure subscription?

Why it matters: Affects the scope of potential subscription model innovations Expected answer: Open to exploring new models while maintaining a premium ad-free experience Impact on approach: Would include ad-supported tiers and other monetization strategies in the proposed solutions

Based on these assumptions, I'll focus on a strategy that balances retention and ARPU growth in mature markets with expansion in emerging markets, emphasizing personalization and exploring diverse monetization models.