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EBM
Presentation
Netflix, Inc.
Giovanna Correa
10 December 2016
Carol Wonsavage
Entertainment Business
Models Full Sail Un...
• Mission of becoming the best
global entertainment distribution
service.
• Best way to watch anything
without needing to ...
American
multinational
entertainment
company
founded on 29
August 1997 in
California
In 2007, Netflix
grew its
business by...
o Diversified mass market
• Based worldwide;
• Age range from 18 to 59 years;
• Very dynamic;
• Constantly changes;
• Foll...
Legal access to
the rich movie
database with
more than
20,000 episodes.
Customers’
ratings are used
for the
recommendation...
• Online streaming service since
2008, using the website for
computers and its application
for smartphones, tablets,
game ...
Value of no-
commitment; efforts
to continue bringing
exclusive original
high-quality content
to get subscribers.
Chances ...
• Contracts with Major
Companies;
• Providing Content;
• Marketing;
• Video on Demand;
Key Activities
Key Resources
Top-quality streaming
media infrastructure:
mandatory
requirement.
Staff: A well-trained
staff able to funct...
• Internet Providers;
• Television Networks
and Motion Pictures;
• Amazon Servers;
Key Partners
• External content: must pay for the
license cost;
• Technology and Development Cost
o Fund the streaming processes;
o Imp...
Cost Structure
Monthly no
commitment
membership
fee:
62% of the
total revenue
for domestic
streaming;
23% of the
total revenue
from
inter...
• To grow its business and increase profitability,
Netflix should focus more on customer segments
and cost structure.
• St...
References
6 Strategies Netflix Can Teach Us for Dominating Our Market | Predictable Profits - Leading Small Business Coac...
Mikhalkina, T. (2014). Netflix Business Model. Retrieved November 23, 2016, from
http://www.cass.city.ac.uk/data/assets/pd...
Nowak, P. (2010, September 22). Netflix Launches Canadian Movie Service - Technology & Science - CBC News.
Retrieved Novem...
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Netflix Business Model - Nine Elements

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This presentation go over the nine business elements of Netflix and their business model.

Published in: Business

Netflix Business Model - Nine Elements

  1. 1. EBM Presentation Netflix, Inc. Giovanna Correa 10 December 2016 Carol Wonsavage Entertainment Business Models Full Sail University
  2. 2. • Mission of becoming the best global entertainment distribution service. • Best way to watch anything without needing to leave home. • Treat their employees with respect and help to develop their career. Why I chose this company:
  3. 3. American multinational entertainment company founded on 29 August 1997 in California In 2007, Netflix grew its business by expanding itself with the introduction of streaming media. Statistics say that on January 2016, Netflix was available in over 190 countries. Netflix entered the film and television industry in 2013, debuting its first series called ‘House of Cards’. The company is releasing an estimated 126 original series or films in 2016. The monthly subscription has three different types: basic, standard and premium, with prices ranging from $8 to $12. Netflix reported over 86 million subscribers worldwide. Background Information
  4. 4. o Diversified mass market • Based worldwide; • Age range from 18 to 59 years; • Very dynamic; • Constantly changes; • Follows technology innovations and consumer behavior; • June 2013 had 36.7 million people subscribed to Netflix (spend 2 billion hours watching Netflix); Customer Segments
  5. 5. Legal access to the rich movie database with more than 20,000 episodes. Customers’ ratings are used for the recommendations Rating enables a better use of movies available on the website Has one of the widest supported devices ranges (mobile, computer, game consoles) Convenience and usability by the ease that is having access to the service Customized browsing gives customers full control over their experience Price is relative to the billions of hours of content that Netflix can provide on their streaming service. Value Proposition
  6. 6. • Online streaming service since 2008, using the website for computers and its application for smartphones, tablets, game consoles and other platforms. • DVD and Blu-ray discs rental by mail; Channels of Distribution
  7. 7. Value of no- commitment; efforts to continue bringing exclusive original high-quality content to get subscribers. Chances of reaching a potential subscriber are higher; those specific people already spend some of their time on the Internet. Online subscription- based entertainment video service = online advertising; social media and web-browsing. Customer Relationships
  8. 8. • Contracts with Major Companies; • Providing Content; • Marketing; • Video on Demand; Key Activities
  9. 9. Key Resources Top-quality streaming media infrastructure: mandatory requirement. Staff: A well-trained staff able to function each duty. Licensing: Customers subscribes to be given the license required to stream on the multiple platforms.
  10. 10. • Internet Providers; • Television Networks and Motion Pictures; • Amazon Servers; Key Partners
  11. 11. • External content: must pay for the license cost; • Technology and Development Cost o Fund the streaming processes; o Improve the originality; • Marketing; • Administrative costs; • DVD Warehouse Operation; Cost Structure
  12. 12. Cost Structure
  13. 13. Monthly no commitment membership fee: 62% of the total revenue for domestic streaming; 23% of the total revenue from international streaming. Domestic DVD and Blu- ray rental services: Around 13% of the total revenue. Declined from 31.5% in 2012 to 13.9% in 2014. Revenue Streams $6.78 billion - 2015
  14. 14. • To grow its business and increase profitability, Netflix should focus more on customer segments and cost structure. • Strategy to grow more of its streaming subscription database both domestically and internationally; • Small net profit compared to the billions of gross revenue; these high expenses is the flaw in the Netflix business model; • To continue retaining the customers, focus also on the key resources from the key partners as they strive to reach customers through the various channels. Conclusion
  15. 15. References 6 Strategies Netflix Can Teach Us for Dominating Our Market | Predictable Profits - Leading Small Business Coaches. Predictableprofits.com. Retrieved 8 December 2016, from http://www.predictableprofits.com/6- strategies- netflix-can-teach-us-dominating-market/ Alsabhan, F. (2011, November 17). Netflix Channel Strategy. Retrieved November 23, 2016, from https://prezi.com/boiegvqoex8a/netflix-channel-strategy/ Farfan, B. (2016, October 14). Mission Statements of Technology Companies. Retrieved November 23, 2016, from https://www.thebalance.com/tech-companies-mission-statements-4068549 Levin, G. (2016, January 17). Netflix Chief Bulks Up on Series (600 hours). Retrieved November 23, 2016, from http://www.usatoday.com/story/life/tv/2016/01/17/netflix-chief-bulks- up-series-600-hours/78931816/ Masters, K. (2016, September 14). The Netflix Backlash: Why Hollywood Fears a Content Monopoly. Retrieved November 23, 2016, from http://www.hollywoodreporter.com/features/netflix-backlash-why-hollywood-fears-928428
  16. 16. Mikhalkina, T. (2014). Netflix Business Model. Retrieved November 23, 2016, from http://www.cass.city.ac.uk/data/assets/pdf_file/0017/220517/Netflix.pdf Minaya, E. (2016, January 06). Netflix Expands to 190 Countries. Retrieved November 23, 2016, from http://www.wsj.com/articles/netflix- expands-to-190-countries-1452106429 Netflix, Inc. SWOT Analysis. (2013). Netflix Inc. SWOT Analysis, 1-8. Retrieved December 10, 2016 from http://web.b.ebscohost.com.oclc.fullsail.edu:81/ehost/detail/detail?sid=450 e218e-35ef-4785-8d66 b02c9111c2db%40sessionmgr101&vid=0&hid=107&bdata=JnNpdGU9ZW hvc3QtbGl2ZQ%3d%3d#AN=93289452&db=bth Netflix - Summary & Results - Q3. (2016, October 17). Retrieved November 23, 2016. Noren, E. (2013, January 21). Analysis of the Netflix Business Model. Retrieved November 23, 2016, from http://www.digitalbusinessmodelguru.com/2013/01/analysis-of-netflix-business- model.html
  17. 17. Nowak, P. (2010, September 22). Netflix Launches Canadian Movie Service - Technology & Science - CBC News. Retrieved November 23, 2016, from http://www.cbc.ca/news/technology/netflix-launches-canadian-movie- service-1.872505 Otto, E. (2014, February 1). Netflix Marketing Plan. Retrieved November 23, 2016, from http://www.slideshare.net/evelyneringia/netflix-markeitn Pogue, D. (2007, January 24). A Stream of Movies, Sort of Free. Retrieved November 23, 2016, from http://www.nytimes.com/2007/01/25/technology/25pogue.html Radak, D. (2016). Breaking Down the Netflix Business Model: The History and the Future of the VOD Giant. Business 2 Community. Retrieved 8December 2016, from http://www.business2community.com/business- innovation/breaking-netflix-business-model-history-future-vod-giant- 01582436#5jzwDsRhhIJqu6ri.97 Rauta, A. (2014). The Netflix Saga Part 1: The Business Model. investazor.com. Retrieved 8 December 2016, from http://investazor.com/2013/11/15/netflix-saga-part-1-understanding- business-model/

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