Once considered the gold standard of streaming, Netflix suffered its first significant loss in over a decade during the first quarter of 2022. How bad was it? Pretty bad. They reported losing 200,000 subscribers, all the while projecting 2 million additional losses for the second quarter. That begs a question: can original anime save the company?

No doubt Netflix has pulled out all the stops to develop original content capable of competing with the likes of Disney+ and other content creators. They have also invested heavily in anime. But now they seem to be at a crossroads. They are facing a younger generation that wants cheaper streaming options without giving up access to their favorite content. Something has to give.

A New Investment in Anime

Despite significant losses, the powers that be at Netflix are continuing to push forward in the anime space. The company announced in late April a new, multi-million dollar deal with Japan’s Studio Colorido. The deal calls for at least three feature films they plan to release to both their streaming platform and live theaters. Meanwhile, new anime series seem to be debuting on Netflix every few weeks.

It is hard to imagine a company like Netflix putting all its eggs in one basket. Perhaps they are not doing so with anime, but it sure appears like they are. Every new deal they announce seems to be related to anime or Japanese content creators in some way, shape, or form.

How ironic that they have suffered such significant losses among the Gen Z crowd. But that's where pricing comes in. Younger viewers do not have the disposable income their older counterparts have. They are being forced to pinch pennies in a tighter economy. They are telling Netflix that they will not come back until the company offers cheaper subscriptions.

That is How Business Works

It is unfortunate that Netflix is struggling right now. It's equally unfortunate that so many young people have canceled their subscriptions. But that's how business works. Furthermore, no business is impervious to market fluctuations. We are just as susceptible as any other company.

We have enjoyed steady growth here at Umai. For the most part, our growth has remained consistent. But we experience ebbs and flows like any other company. There are times when demand for our anime sweatshirts and t-shirts explodes to the point of stretching our capacity. There are other times when business is comparatively slow.

The key to surviving ebbs and flows is paying attention to customers. You give them what they want at a price they can afford. That seems to be the message Netflix is getting right now. Subscribers are unhappy with their pricing. Despite loving all the original content – including most of the original anime – there is a certain price point at which customers cannot justify paying the bill.

Wait to See What Happens

The business world was stunned by Netflix's first quarter losses. A second shockwave may be on the way when Netflix announces its second quarter numbers. If their predictions hold true, losing an additional two million subscribers could be financially devastating. We will have to wait to see what happens.

In the meantime, be sure to catch your favorite Netflix anime series as new episodes come out. Every time you watch, you are giving the company another reason to invest in more anime content – original or otherwise. Likewise, we will keep producing high quality anime clothing and accessories. We invite you to visit our website as often as you can, making sure you stay abreast of all our latest offerings.