Crunching Feedflix Stats for Netflix Trends

Davis Freeberg —  August 8, 2008

A few months ago, Raghu Srinivasan launched a website named Feedflix that analyzes your customized Netflix RSS feeds to track how you’re using your membership. The site can tell you things like how much you spend per DVD rental or the typical number of days that you hold onto your DVDs before sending them back for new ones.

While having someone automatically calculate this data is helpful to me, when I first used the service it didn’t really tell me anything new about how I use Netflix. Since I enjoy number crunching, I had already been tracking this info and know I’m spending about $3 for every DVD rental.

What Feedflix did offer me, though, was a way to compare how I used the service in relation to other Netflix customers. When it first launched, I didn’t think that Feedflix would have enough members for a legitimate sample size, but with the service growing over the past few months, I wanted to check back and see what it could tell me about how others are using Netflix.

How Long Do Customers Keep Their Rentals?

Keep Until Return

Feedflix doesn’t answer this question directly because they break the data into separate groups, but if you do a little bit of math, it’s not too hard to estimate the average rental. What I found surprising about the results was that, even with 75% of the user base returning their DVDs within 10 days, the drag from the other 25% of users brings the average rental period to 9.55 days. In the past, Netflix has said that people who don’t rent as many movies have a tendency to churn at a higher rate, but this data would suggest that they contribute to the lionshare’s of Netflix’s profits before they drop off completely.

How many users subscribe to each plan?

Popular Plans

Netflix has never given a breakdown on the number of subscribers in each plan, but Feedflix can give us a reasonable guess as to what this might be. According to Netflix’s latest earnings report, they currently have 8.4 million subscribers. By extrapolating Feedflix’s breakdown of Netflix service plans to the larger subscriber base, we get the following estimates on where customers are spending their money.

1 at a time – 2.1 million subscribers
2 at a time – 2.4 million subscribers
3 at a time – 3.1 million subscribers
4 at a time – 500K subscribers
5 at a time – 168K subscribers
6 at a time – 84K subscribers

To test the data, I multiplied the number of subscribers from each group by the price points on their corresponding plan and came up with an expected 3 month revenue number of $352 million*. The real result from their latest quarter was $337,600,000, so these numbers may be a little bit off, but not entirely unrealistic.

*My results didn’t include any of the 7 or 8 at a time subscribers because Feedflix didn’t have enough data on them. It’s also worth noting that there are rounding errors to take into account. My analysis also assumes that there is a 3:1 ratio between the $4.99 and $8.99, 1 at a time subscribers and makes a weighting adjustment for the difference between the 8.24 million subs at the start of their quarter and the 8.4 million that they finished with.

What is the average cost per rental for Netflix customers as a group?

Getting at this number is a little bit trickier, but if I multiple the breakdown of each plan, by the number of discs that an average Netflix customer is expected to use each month, then my math suggests that Netflix is earning $1.94 in revenue, per DVD rental. At first this number seemed a little low to me, but it would verify Netfix’s claims that they earn a higher profit on 1 at a time subscribers vs. the higher revenue 3 at a time moviehounds. If my estimates are right, it would also mean that Netflix is shipping 1.97 million DVDs per day or nearly 60 million DVDs per month.

It’s worth pointing out that there are a lot of ways that this data and/or my calculations could be wrong so take it with a grain of salt, but if Feedflix’s numbers are representative of the larger Netflix customer base then it would suggest that if you aren’t getting at least $2 per DVD each month, then you are one of the skinny guys at the all can eat buffet.

If you’d like to view my Feedflix account you can find it here.

Davis Freeberg is a technology enthusiast living in the Bay Area. He enjoys writing about movies, music, and the impact that digital technology is having on traditional media. Read more at Davis Freeberg’s Digital Connection. Davis is a Netflix shareholder.

4 responses to Crunching Feedflix Stats for Netflix Trends

  1. Very cool! But definitely need a few grains of salt here… ;) If they automatically scraped *all* Netflix feeds, it’d be more telling. I suspect the folks using this site are the more dedicated customers who probably watch more flicks (relative to their plan). Also, this doesn’t appear to take into account Watch Instantly. Example: For about 3 months I was on the unlimited 1-out plan – while only watching stuff online or Roku, and not sending the disc back. But just a week ago I bumped my plan and have been having The Wire discs shipped/returned in rapid succession.

  2. A couple of things that could throw off the calculations. A LOT of people are still on older rate plans, people who have sub’d for 5+ years (myself included 8+) and have 2+ (2 @AT unlimited) and pay 12.99$. There have also been rumours that NFLX likes to amp free membership programs DURING the quarter, to help pop the subs EOQ. (they have been dinged before I think for including FREE subs in TOTAL SUBS, but maybe they have at least started booking an expense – which they should)

    Another point is, that even though it is 2+, one can often have 2+2, and even those on 2-3 limited plans, can have 2-3+ results. This would skew the numbers of DVD’s per monthly fee, but the FEEDFLIX stats SHOULD incorporate that into the amount.

    I figure I’m paying WELL under 2$, more like 1.5$ at most for the DVD’s I’m getting monthly. (and most are now BRDVD which would make it even a bit more worthwhile.

    Needless to say, I can count the number of times I have been in a blockbuster store in the past several years, on one hand with three fingers broken off. :j

  3. Feedflix does ask you to confirm what they guess your rate plan is. Mine was right but I just upgraded.

    As far as Blockbuster, I haven’t been in at least 3 years – possibly longer. I’ve been using Netflix on and off since 1999 or 2000. Back then, tracking down DVDs was hard. When I got my first player in 1998, the major rental stores had no movies and the local one only had a select few. Though it was pretty cool in some ways – I’d tell them what to buy for their collection (like Criterion Silence of the Lambs) and then I’d rent it when they got it (single copy!) in.

  4. This is a very good article! So the average price per DVD is $2-3? Makes me feel better about paying $3-4 for SD rental on Vudu (HD rental prices hurt though).

    Personally, I only had trials from Netflix as I live next to Blockbuster store and — when I used my Blockbuster Online actively — could get a lot more rentals by returning 3 movies to the store, renting 3 for free, and getting 3 shipped out to me. Although, now the regular plans aren’t as generous (I kept my old one but froze it for now).