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Over the past 20 years, Netflix has grown from a plucky startup to a company valued at nearly $400B.

As of 2023, the platform had more than 280 million total customers.

They may have disrupted an entire industry, but it’s no secret that for many years streaming services like Netflix were looked down on by critics and ignored during awards season.

It wasn’t until 2019 when Netflix’s Roma was nominated for Best Picture at the Oscars that they began to make headway within the film and entertainment establishment.

Netflix made a conscious, strategic move to woo Academy voters, and it paid off.

In 2024, Netflix was nominated for 19 Oscars (down from its best year, 2021, where they nabbed 35 nominations).

Unsurprisingly, their success was down to a deep understanding of marketing psychology and behavioral science…

Today I’m breaking down:

• The psychological, business, and creative benefits of winning awards

• How awards leverage psychological principles like the Halo Effect, Authority Principle, and Confirmation Bias

• How you can apply Netflix’s strategy to your own business, no matter its size or industry

👉 But before we get started, a reminder that you can save 30% on a Guest Pass to my latest workshop, “300% More Sales from Email - My Framework for More Effective Email Marketing.”

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The Psychology (and Business) of Winning Awards

Winning awards isn’t just an ego boost for Netflix — there’s a business reason behind it.

The best actors, directors, and writers want to work with the most acclaimed studios (because they want to win awards, too).

Awards keep streaming platforms top of mind for customers, attracts new subscribers, and helps keep existing ones.

How?

With psychological principles like the Halo Effect, Authority Principle, and Confirmation Bias…

1. What Is the Authority Principle?

The Authority Principle (also called Authority Bias) says that people tend to comply with those in positions of power, such as police, government leaders, professors, and perceived experts.

As Professor Robert Cialdini, an expert on the Authority Principle and the author of Influence: The Psychology of Persuasion, put it:

How do awards drive the Authority Principle for Netflix?

Awards are seen as signals of expertise in many industries.

Because of the Authority Principle, knowing a movie has won an Oscar can act as a mental shortcut that makes it easier for people to choose Netflix over other streaming platforms.

Just like a military uniform or an advanced degree, awards inspire a feeling of trust in authority.

They make Netflix look like experts at producing critically-approved content that everyone wants to watch.

2. What is the Halo Effect?

Coined by psychologist Edward Thorndike, the Halo Effect describes people’s tendency to let one positive trait guide their total opinion of a person, product, or experience.

The Halo Effect is often referenced when talking about beauty. Studies have shown that we consider good-looking people more intelligent, more successful, and more popular.

Attractive people even receive lighter prison sentences when judged for the same crime as an unattractive person.

How do awards drive the Halo Effect for Netflix?

The Halo Effect isn’t just about giving beautiful people the benefit of the doubt. This principle also has implications for business and marketing.

When a title like Icarus, Roma, or Marriage Story wins an Oscar, it has a Halo Effect across the entire Netflix platform.

Now users see the company as a destination for popular, critically-acclaimed films even if every title isn’t of the same quality.

After a while, it becomes a virtual cycle of award wins that fuel positive perceptions, which helps drive more award wins.

3. What Is Confirmation Bias?

Confirmation Bias describes peoples’ tendency to search for, interpret, favor, and remember information that confirms their choices and beliefs.

As author Harper Lee put it:

For example, when customers decide to buy something, they are more open to information that confirms their purchase was high quality, healthy, a good value, or environmentally sustainable.

Customers want to believe they’ve made the right choice, so communications that support that belief are well-received and better remembered.

How do awards drive Confirmation Bias for Netflix?

When a customer pays for a streaming service every month, they make a calculated risk that they will continue getting good content.

A small monthly payment might not seem like much of a risk, but with more and more streaming services entering the market, the fight for subscribers is only getting tougher.

So when a customer signs up for Netflix, finds a few movies or shows they enjoy, and these same shows start winning Emmys and Oscars, suddenly that calculated risk seems like a smart move.

Winning awards leverages Confirmation Bias to ensure that customers stick around because the next big Netflix show is probably on the way.

If you want to apply these principles to your business like Netflix did, start by asking yourself a few questions:

• Authority: Are we evoking symbols of authority (awards, qualifications, certifications) at the right moments in our marketing or customer experience? If so, can we use them to better build trust with our customers?

• Halo Effect: Do we have any partnerships with other brands or people that our ideal customers respect? Could we do a better job of communicating our award wins (or winning awards full stop)?

• Confirmation Bias: Is there a way to give customers a virtual pat on the back or a reminder that they’ve made a great choice?

Until next time,
Jen

PS. I’ve opened up some one-on-one spots to work with a few businesses starting in January. You can get started and reserve your spot for just $350.

I’m sending out details to the email list next week but if you’re interested now I can share the details early (these spots are first-come, first-serve and there are only a few left).

Just reply to this message and say “tell me more” and I’ll share the details.

*Header image source: Aerial Film Studio - stock.adobe.com