What does changed customer
behavior mean for businesses
that don’t change as well?
• A physical network
 • Fee and Value conscious consumers
 • A wired customer base



Imagine this Company
• Digital overcame physical inventory limits
 • Netflix competed on price and fees

 • Digital services created new value
...
Behavior Can Change Quickly
• Maximize convenience to minimize desire for new
    services
  • Continue developing complimentary services to support
 ...
This was the great cross-channel
  innovation that started it all

Clearly this is their priority
  http://www.fastcompany...
“People like you”
                                                     intelligence +                                     ...
Partnership with

                                     stream to living
                                     boxee enables...
How does Netflix make sure they
  get to the living room TV before
  anyone else?



An Important Question
Oct. 26: “10MM North American
  Playstation owners get Netflix streams for
  no extra cost
Clearly this is their priority
• Craig Konieczko
    • Strategist, LBi IconNicholson
    • 347-526-7943
    • Craigkon1 on Twitter
    • ckonieczko@iconn...
LBi Thought Starter Block Buster V Netflix
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LBi Thought Starter Block Buster V Netflix

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Netflix created value for customers by getting more titles - thousands more titles - into living rooms by exploiting channels that customers prioritize for convenience and sharing (Facebook, mail, and now, PS3s), and skipping over the broad, physical network of stores that have been a liability to Blockbuster)

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  • Smart and thorough presentation that includes the value of customer convenience and adding value at every step of customer acquisition and brand referral. Nice job Craig.
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LBi Thought Starter Block Buster V Netflix

  1. 1. What does changed customer behavior mean for businesses that don’t change as well?
  2. 2. • A physical network • Fee and Value conscious consumers • A wired customer base Imagine this Company
  3. 3. • Digital overcame physical inventory limits • Netflix competed on price and fees • Digital services created new value • Netflix was more convenient What Happened?
  4. 4. Behavior Can Change Quickly
  5. 5. • Maximize convenience to minimize desire for new services • Continue developing complimentary services to support the physical network • Create Lock-in through reliance on saved profile information, preferences and rewards that raise switching costs Implications
  6. 6. This was the great cross-channel innovation that started it all Clearly this is their priority http://www.fastcompany.com/blog/kit-eaton/technomix/could-netflix-run-us-postal-service
  7. 7. “People like you” intelligence + Gotta wait for a explicit ratings x High x couple of days v. x x quick drive home x Satisfaction and Value x x Can pay with cash x End on a bang, not x x a forgettable Med x Logging on to Web x experience site v. driving to store x x Return on your own schedule v. steep x x x x x late fees x x x x x Low Go to the source Decide & buy Need a movie? What to see? Will we like it? Explore options Need a suggestion Browse related Find time to watch Sit down & view Return to source Get it home Tell someone Web Mobile Social In-Person
  8. 8. Partnership with stream to living boxee enables Facebook widget x Tell someone x room Return to source x x Sit down & view x x Streaming movies Find time to watch x x x Get it home on demand x x x Decide & buy Browse related x x Need a suggestion x x Explore options x x x x Will we like it? Go to the source x x x What to see? Need a movie? x In-Person Social Mobile High Med Low Web Satisfaction and Value
  9. 9. How does Netflix make sure they get to the living room TV before anyone else? An Important Question
  10. 10. Oct. 26: “10MM North American Playstation owners get Netflix streams for no extra cost Clearly this is their priority
  11. 11. • Craig Konieczko • Strategist, LBi IconNicholson • 347-526-7943 • Craigkon1 on Twitter • ckonieczko@iconnicholson.com • www.lbiiconnicholson.com LBi IconNicholson

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