Netflix strategic group map

The strategy best fits the broad differentiation generic strategy.

a strategic analysis of netflix inc

There are also government policies to reinforce the barrier. In Netflix headquartered in Los Gatos California began operations as a regional online movie rental company.

netflix strategy analysis

Finally, I would advise James Keyes Blockbuster CEO to reduce the costs of acquiring products from their company and consider introducing an online-based, instantaneous service. However, the evolution of technological strategies will lead to an increase in the competitive intensity in the long-term.

Research paper on netflix pdf

However, the entrance of new modes of movie consumption threatens the attractiveness of its situation. However, major tech companies, like Google, have the capital-base to introduce more affordable rental services see Appendix A: Five-force analysis of the movie rental marketplace Several forces are driving change in the movie rental industry. Executive summary: Netflix employs a subscription-based business model and subscribers can chose from a variety of subscription plans. While the firm demonstrated that a market for online rentals existed, it was not financially successfully. On the other hand, although Netflix model requires the users to have access to high-speed Internet, it has the potential of attracting more customers as Internet costs reduce in the long-term. In , Netflix had 1 million customers, in , they had a 5 million customers, and in , a whopping 14 million customers. The ratios indicate that the company has enjoyed sustained progress in its financial performance.

Customers are always on a look out for the products that have the best quality but come at an affordable price; in addition, the use of technology has increased the demand for products that a customer can acquire at the press of a button that is, instant gratification.

As long as the companies that have a lower market share fail to offer their customers affordable prices for premium content, the competitive intensity will remain low.

The essence of the report however, is to highlight the issues surrounding the current technological advancements in the DVD rental market now that VOD has become a feasible and realistic platform that can be supported. They include 1 convenience, 2 lifestyle changes, 3 the economy, 4 the available options, and 5 costs and efficiency changes.

Works Cited Thompson, Arthur A. However, Blockbuster has an advantage of better customer service because of the physical contact that its stores can offer customers. As a result, the company strives to achieve a competitive advantage by offering the best product or service, which, in turn, attracts customers.

Feel free to share it with your friends or bookmark the page to give it a read later. This Case study was written by Handmadewriting Netflix Business Model and Strategy in Renting Movies and TV Episodes According to the five-force analysis of the movie rental marketplace, the competitive forces are not strong.

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