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Netflix achieve payback on each new U.S. subscriber after 11 months

According to reports video streaming giant, Netflix’s cost of adding new subscribers in the U.S. is now $100 per net new subscriber. Netflix’s 14% expenditure is on marketing costs today. With increasing marketing spend coupled with falling subscriber growth in its native place mean, the online streaming service takes 11 months to achieve payback on net new domestic customers.

Netflix’s U.S. marketing spend has increased significantly, both in absolute and relative terms. In 2014-2015 Netflix spent $0.3bn per year on marketing compared to $0.4bn in 2016 and $0.6bn in 2017, according to reports.

Here it can be noted that the cost of adding a new international subscriber is $40-$45 and the trend is relatively flat. Netflix is yet to comment on the report.

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