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Netflix is good for us, says Foxtel CMO

Foxtel CMO Andy Lark doesn’t see Netflix as a competitor as the subscription TV provider looks to retain customers with its 4k television offerings and attract new customers with its own streaming services, the veteran marketer told a conference in Sydney.

“Netflix sells in a different market to what Foxtel sells to,” said Lark. “We sell to premium home-based subscribers who typically want a lean back experience and a shared family experience. Netflix doesn’t.”

Lark: Netflix doesn’t give people everything they need

Despite the differences, Lark – who joined the company in January – said Netflix was good for Foxtel.

“Netflix stacks onto us, Netflix is actually is good for us as it encourages more people to video consumption,” he told a panel at the ADMA Global Forum in Sydney.

“Who here can truly say they can get everything they want from Netflix?,” Lark asked. Approximately six people put up their hands.

“See, there’s around 3% of the room,” said Lark. “That’s great for that 3% but that’s not our target audience. It’s so important as a marketer to know who our market is.

“The hardest thing to do as a marketer is understand the customer you do not serve.”

Lark’s comments come at a time when Foxtel is losing ground to streaming services including Netflix.

When asked by Mumbrella who he saw as being Foxtel’s new customers, Lark said: “There’s a part of the market that wants a pure, lean mobile experience sub $15 that wants to hop in and out of the market.

“So they only want to pay when there is something to watch so they’ll go ‘Okay, I’ll subscribe to Stan because I want to watch Billions, but there’s nothing else I want to see.” he said.

“That’s an interesting part of the market which we’ve addressed with [Foxtel] Now which is growing very quickly for us. We have some more really exciting products coming in the OTT streaming space.

We launched Foxflicks yesterday, which at first is available as part of the Foxtel subscriptions. If you’re large like us, you can start applying yourself in those other things really effectively and efficiently, but you have to stay true to your customer.”

Lark was enthusiastic about what 4K television will deliver for Foxtel, having announced a dedicated 4K channel featuring cricket slated for an October launch: “When you see 4K content you’ll never go back.

Foxtel announced earlier this year it would be moving from cable delivery to satellite, with a spokesperson telling Mumbrella it was the best option for high quality video images watched on the large screens in homes and other venues.

“The only way you can reliably get 4K is through satellite,” Lark said.

Earlier, Lark spoke about how he sees disruptive forces effecting incumbent businesses and how he thinks the challenges are usually overstated.

“I think disruption’s a funny word,” he said. “I’ve been on both sides of this, building startups, funding startups, building highly disruptive businesses and working at traditional businesses and really the effects of disruption are vastly overstated relative to time and effect.

“It takes 10 to 15 years for technology to make its way into the mainstream, it takes another 10 or 15 years for business models to evolve.

“When you look at the entertainment business today it’s fascinating. We’re in the golden age of video and video is the dominant consumption model. Today more people will watch television than anything else.

“More people will enjoy correctly measured long-term television experiences than they will watch any other medium. What it really comes down to is that it’s not a battle between streamers versus TV, it’s a battle of stackers versus TV.

“More people started watching television in America than streamed. More people are connecting paid TV services than streamed. The reason is the stackers are basically aggregating all of the streaming services which doesn’t make much money at all,” he said.

“Meanwhile the large players are aggregating content at scale,” Lark continued.

“There’s a long history of company like this – Target saying we don’t fear Amazon, Toys ‘R’ Us saying that and two years later being in bankruptcy. Blockbuster saying Neflix is not a threat.

“The hardest thing for marketers is zooming out and saying ‘The people I work for really get it.’ Because if they don’t, it’s best to go somewhere else.

“If the guy or the girl driving the bus is driving it over a cliff, then get off the bus before it goes over the cliff.”

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