‘Stranger Things’ ushered in a new era for Netflix

The original concept for what would become “Stranger Things” was rejected by more than 15 studios before it was spotted. Netflix Original program lineup.

Ten years later, the show, created, written and directed by Matt and Ross Duffer, has become one of the biggest cultural touchstones of the streaming era, establishing Netflix as not just a competitor but a leader in its field.

“People always talk about Netflix, but our biggest moment was when we aired ‘House of Cards,’ which was a big deal. But our real moment was when we aired ‘Stranger Things,'” co-CEO Ted Sarandos said at the Stranger Things Season 5 premiere in Los Angeles last month.

“House of Cards was great. I felt like it told the world that we were going to make a really good TV show,” he continued. “But with ‘Stranger Things,’ this is much closer to a ‘Star Wars’ moment. This is a show, a character that moved culture, spawning live events, consumer products, spinoffs and sequels.”

Stranger Things, released in 2016, is set in the 1980s and centers on a group of middle school students living in a fictional rural town in Indiana who must deal with paranormal and paranormal activity after their friend disappears. Among them are a telekinetic girl who escapes from a secret laboratory, an alcoholic police chief trying to find a missing boy, and a deranged mother.

Now, nearly a decade later, the fifth and final season is being released in stages on Netflix.

Volume 1, consisting of the first four episodes, was released over the Thanksgiving holiday and garnered 59.6 million views in the first five days, making it the biggest premiere week for an English-language series on Netflix. It ranked third overall after seasons 2 and 3 of the Korean drama “Squid Game.”

In its second week on the platform, Volume 1 generated an additional 23.6 million views, ranking No. 1 on the streamer’s weekly charts, and Netflix reported that each of the past four seasons had increased viewership on a weekly basis as fans rewatched previous episodes.

The three-episode second volume of Stranger Things season 5 arrives on Christmas, with the final episode, which has a runtime of just over two hours, set on New Year’s Eve. The finale will be available in select theaters on New Year’s Eve and New Year’s Day.

Breaking with tradition, Netflix will not be selling tickets for these screenings. Instead, more than 500 movie theaters across the country will sell discounted tickets that guarantee seats at screenings. This coupon can be used to purchase food and drinks at the venue. Additionally, theater owners keep all of the proceeds from these purchases.

Netflix and the box office have clashed in the past over distribution terms, as the streamer has not committed to long-term theatrical runs for films it hopes will compete for awards.

“Nothing makes us happier than bringing Netflix theatrical movies to theaters,” AMC CEO Adam Aron said in a statement earlier this month. “We think it’s beneficial for everyone involved. But we still need to treat existing studio partners fairly, so there’s still a lot of work to be done to do that. Still, progress is being made.”

“Stranger Things” ushered in a renaissance in the 1980s, reviving fashion trends, music and even defunct food brands for a new generation.

When the series debuted, Netflix was partnering with consumer brands to create T-shirts, mugs, stuffed animals, and more, but primarily with licensees. This means that other companies were charging fees to design and manufacture their products, or were participating in brand partnerships where no fees were exchanged.

The company launched its own consumer products division in 2019 and its own officially licensed online shop two years later.

Coinciding with the launch of the final season of Stranger Things, Netflix announced dozens of partnerships and collaborations with brands across merchandise, retail and restaurants.

Streamer tapped Lego, funkoSushmallow, hasbroJazzwear and Care Bears will offer “Stranger Things” toys and merchandise to fans of the series. We have apparel and lifestyle deals gap, nike, crocsCoverGirl, Zara, Wrangler and more, as well as collaborations with Eggo, Doritos, Kellogg, Gatorade, starbucks.

“We’re thrilled to partner with so many great brands to bring one of our biggest campaigns to date to Stranger Things, as we celebrate the largest collection of products and experiences in Stranger Things history and the final season of this universally beloved series,” Netflix Chief Marketing Officer Marian Lee said in a statement earlier this month.

Outside of retail, Netflix has expanded into the live events space, bringing “Stranger Things” to life through immersive experiences that allow fans to explore Hawkins Laboratory and other iconic locations from the series. It currently operates in Abu Dhabi, United Arab Emirates, and is scheduled to open in Mexico City next month.

There is also a play called “Stranger Things: The First Shadow,” which will run in London’s West End from 2023 and in New York from this spring.

Additionally, Netflix has a deal with Epic Games to bring Stranger Things items to the popular online video game Fortnite.

Netflix’s product and live events strategy is more than just a way for the company to generate revenue beyond streaming subscriptions. Industry experts say it helps fans stay focused on content during show hiatus and between movie sequels.

This strategy isn’t unique to Netflix, but it shows the streaming service’s maturity. “Strangers Things” is more of a gold standard of possibility than a blueprint that every Netflix show or movie can adopt.

“[Netflix]had some good shows early on (‘Orange is the New Black’ and ‘House of Cards’), but it took them a few years to come up with ‘Stranger Things,'” Wedbush analyst Michael Pachter told CNBC in an email. “Since then, they’ve had great success with shows like ‘Squid Game’ and ‘Bridgerton,’ but we wondered if they could establish a formula for coming up with original IP.

“Stranger Things has consistently been a solid IP and has generated a lot of recognition,” he added.