The end of ‘Stranger Things’ might actually be a boost for Netflix

This article was originally published on All figures quoted in US dollars unless otherwise stated.

A group of young people sit together watching a television very intently with wide-mouthed, awed expressions while one holds a large bowl of popcorn with a bottle of beer in the foreground.

This article was originally published on All figures quoted in US dollars unless otherwise stated.

Netflix (NASDAQ: NFLX) released the fourth and penultimate season of Stranger Things between May and July, which amassed millions of views. The creators of Stranger Things have not revealed the launch date for season five, but have confirmed it will be the final season. Here’s why the show’s end might actually be positive for Netflix’s growth. 

Utilizing talent

Stranger Things launched on Netflix in July 2016, receiving universal acclaim and making overnight stars of its almost entirely unknown cast. Netflix did not reveal subscriber viewership back then, but analysts have surmised the show reached an average of 14.07 million adults in the U.S. in its first 35 days — making it the third-most-watched season of a Netflix original series at the time.

The second season soared further, earning a nod from Guinness World Records for the most in-demand digital original series of 2017. The latest season of Stranger Things has only added to the show’s success, becoming the first English-language Netflix series to cross one billion viewing hours within 28 days. The show has become a valuable tool for Netflix to retain subscribers.

Moreover, the cast and creators of Stranger Things are advantages Netflix can utilize in its fight to win the streaming wars. The show’s creators, Matt and Ross Duffer, often called the Duffer Brothers, announced the launch of their production company, Upside Down Pictures, in early July. The duo has unveiled various upcoming Netflix projects, including a Stranger Things spinoff, a Stephen King adaptation, and a live-action Death Note series. The end of Stranger Things would increase the number of projects the Duffers can devote time to, adding more content to Netflix’s library to attract subscribers. 

The show’s end would also free up its cast for other projects. Netflix has already had Stranger Things lead Millie Bobby Brown star in the 2021 film Enola Holmes, which became the seventh-most watched Netflix original movie in history, with 76 million views, and prompted a sequel yet to be released. Brown will also star in an upcoming Russo Brothers (Avengers: Infinity War, Endgame) film, The Electric State.

Once Stranger Things ends, its other immensely popular stars will be increasingly available to take part in additional Netflix originals — potentially pulling in additional fans and subscribers. 

The Stranger Things “cinematic universe”

The tremendous success of Stranger Things could lend itself to the creation of a cinematic universe. It also raises the potential for Netflix to have something that could put its library of content in a similar league to its biggest competitors: Walt Disney‘s (NYSE: DIS) Disney+ and Warner Bros. Discovery‘s (NASDAQ: WBD) HBO Max. Both have utilized well-established franchises from their parent companies’ content libraries to inspire streaming originals, encouraging large fanbases to flock to their platform. 

Disney has gained millions of views on Disney+ with a variety of original series based on various Marvel properties and the Star Wars universe. In January 2021, the Disney+ series WandaVision featured popular Marvel characters and was 81.3 times more watched than the average streaming show across all platforms, according to a TVision analysis. More recently, in May, the Star Wars series Obi-Wan Kenobi premiered on Disney+ and became the most-watched series on the platform ever with the premiere pulling in 2.14 million viewers.

If Netflix can use the popularity of Stranger Things to kick off a variety of other series and films with some connection to the original show, the show’s many fans could have further reason to retain their Netflix subscriptions. Disney has used its Marvel and Star Wars series to create a consecutive schedule of releases that leaves subscribers less willing to drop Disney+. Netflix could similarly encourage subscriber retention by releasing content based on Stranger Things and other projects starring its actors to keep its members.

While Stranger Things has a substantial fanbase, the Duffer Brothers also have the potential to entertain Netflix members with different interests. The filmmakers’ upcoming projects prove the potential for Netflix to grab viewers from alternative entertainment domains with a long history of attracting fans. Stephen King adaptations and manga-inspired content have attracted large audiences in the past and can certainly do so for Netflix.

The future of Stranger Things

For Netflix to retain Stranger Things as an asset, the last season must satisfy its loyal fans. Keen investors will want to keep an eye on the critic and audience scores of season five’s episodes, particularly its finale. High scores will mean Netflix continues to have the potential to grow a cinematic universe and mean its creators’ names still hold weight when attached to other projects. 

This article was originally published on All figures quoted in US dollars unless otherwise stated.

The post The end of ‘Stranger Things’ might actually be a boost for Netflix appeared first on The Motley Fool Australia.

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Dani Cook has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Netflix and Walt Disney. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended the following options: long January 2024 $145 calls on Walt Disney and short January 2024 $155 calls on Walt Disney. The Motley Fool Australia has recommended Netflix and Walt Disney. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

This article was originally published on All figures quoted in US dollars unless otherwise stated.

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