TBI Tech & Analysis: How grocery shopping is helping Netflix pay the bills in France

Griselda (Source: Netflix)

Griselda streamer Netflix has announced a partnership with French supermarket group Carrefour to offer its Standard with ads subscription tier as part of the Carrefour Plus subscription and loyalty scheme. Omdia’s Matthew Evenson explores what the streamer hopes to gain from this pact.

As of last month, customers in the city areas of Rouen and Bordeaux – located in the north and south-west of France, respectively – can join Carrefour Plus in-store or online to get a 10% discount on more than 6,000 Carrefour products and free home delivery on orders over €60, in addition to the Netflix subscription.

A Carrefour Plus subscription will cost €5.99 per month – currently the same subscription cost as the Netflix Standard with ads tier – and could be rolled out across the country later in the year if it proves successful in these two initial test areas.

Impact assessment and outlook

Netflix introduced its Basic with ads advertising tier in France in November 2022 as part of the rollout across 12 global markets. It has since upgraded the plan to Standard with ads and closed its non-advertising Basic tier to new subscribers (existing subscribers to the Basic tier can currently remain on this plan).

The move essentially positions the Standard with ads plan as the new entry-level option. Given that the Basic tier had risen in cost to €8.99 per month prior to its closure, €5.99 is a lower point of entry for the customer, but the inclusion of advertising will enable Netflix to generate additional revenue.

Much in the same way that additional non-Prime Video benefits help reduce churn for Amazon Prime, Netflix will be hoping that its participation in Carrefour Plus will keep these customers subscribed for longer. By associating Netflix with an essential and regular activity like grocery shopping, it may also encourage customers to view their Netflix access as more of a utility and a standard aspect of everyday life.

The excerpt above comes from Omdia’s ‘TV & Video Industry Developments Impact Brief – January 2024’, which can be read in full here (with a subscription). Omdia and TBI are both part of Informa Tech.