This document provides information about Netflix's business strategy. It discusses Netflix's history and business model, including its transition from DVD rentals to streaming. It also analyzes Netflix's external and internal factors through various matrices. Some of Netflix's identified strategic alternatives include reducing prices through quarterly/yearly subscriptions, including more multi-lingual content, and producing more original content. The document recommends Netflix develop a clear mission and vision statement and discusses its international expansion and content diversification strategies.
A comprehensive report evaluating Netflix, Inc. viability, stability, and profitability for future investment. The analysis provides an assessment of the firm's strategy, accounting, financial, prospective, and comes up with a buy/sell recommendation.
A comprehensive report evaluating Netflix, Inc. viability, stability, and profitability for future investment. The analysis provides an assessment of the firm's strategy, accounting, financial, prospective, and comes up with a buy/sell recommendation.
Netflix’s unique DVD rental service has revolutionized the industry. They successfully took the best of traditional conventions (like physical media, the U.S. Postal Service) and mixed them with new world internet-conventions. They have also effectively managed to discourage competition from both more established businesses and new entrants. The future growth of Netflix as it expands into streaming media, poses challenges in legal, infrastructure/technology, and through additional costs. In order to remain competitive, it is imperative that Netflix partner with companies with global reach to overcome these challenges. This presentation was part of an MBA class assignment to audit and industry in the the technology sector. The presentation has multiple authors listed on the title page. If you would like copies of the executive summary, complete S.W.O.T. analysis, and/or the transcript of the presentation please PRIVATE MESSAGE ME and I will email it to you.
Researched Netflix's existing market and recommended strategies for them to develop.
Conducted SWOT analysis, product and market analysis
Based on their market growth ad financial overview, developed marketing strategies
Developed BCG Matrix and understood Porter 5 forces to estimate the competitive strategy
Case study over current position of Netflix and where it is heading. AFI framework was used to provide insight into new viable strategies with recommendations on how Netflix can maintain a competitive advantage in the future.
This report is a semester report for the course Marketing Management. The case company has been chosen collectively in the group. The repor contains Netflix's marketing strategy analysis, target group analysis and its operating market (micro and macro environment) analysis
Over the course of the semester I worked on a group project on Netflix. Taking a look into Netflix's history and how they compete against their competitors.
This is a group project that we had to present at George Brown College. A problem that Netflix had during the early 2000s when they had to switch from DVDs to online streaming due to the Dot Com buzz.
Netflix’s unique DVD rental service has revolutionized the industry. They successfully took the best of traditional conventions (like physical media, the U.S. Postal Service) and mixed them with new world internet-conventions. They have also effectively managed to discourage competition from both more established businesses and new entrants. The future growth of Netflix as it expands into streaming media, poses challenges in legal, infrastructure/technology, and through additional costs. In order to remain competitive, it is imperative that Netflix partner with companies with global reach to overcome these challenges. This presentation was part of an MBA class assignment to audit and industry in the the technology sector. The presentation has multiple authors listed on the title page. If you would like copies of the executive summary, complete S.W.O.T. analysis, and/or the transcript of the presentation please PRIVATE MESSAGE ME and I will email it to you.
Researched Netflix's existing market and recommended strategies for them to develop.
Conducted SWOT analysis, product and market analysis
Based on their market growth ad financial overview, developed marketing strategies
Developed BCG Matrix and understood Porter 5 forces to estimate the competitive strategy
Case study over current position of Netflix and where it is heading. AFI framework was used to provide insight into new viable strategies with recommendations on how Netflix can maintain a competitive advantage in the future.
This report is a semester report for the course Marketing Management. The case company has been chosen collectively in the group. The repor contains Netflix's marketing strategy analysis, target group analysis and its operating market (micro and macro environment) analysis
Over the course of the semester I worked on a group project on Netflix. Taking a look into Netflix's history and how they compete against their competitors.
This is a group project that we had to present at George Brown College. A problem that Netflix had during the early 2000s when they had to switch from DVDs to online streaming due to the Dot Com buzz.
ISOM 310 Netflix CaseNetflix 2013 Case Online Video Matures.docxpriestmanmable
ISOM 310 Netflix Case
Netflix 2013 Case: Online Video Matures
In the 1980s and 1990s, people joked about how difficult it was to program a VCR to record a television program. Products like TiVo and other DVRs (digital video recorders) made it easy for consumers to record broadcasted shows and movies. Today, consumers have a wide variety of options in satisfying their desire to watch movies and TV shows. They can rent DVDs and video games from traditional brick and mortar video stores, such as Blockbuster. Cable TV and Satellite TV companies offer premium subscription channels (such as HBO) for a monthly fee, as well as, video-on-demand services. There are other options for those with broadband Internet connections, such as programs that store entertainment and redirection devices (like Slingboxes
). Consumers also can rent or purchase DVDs, Blu-ray discs, and video games at video rental stores, vending machines (like Redbox
), and also can purchase them at electronic stores (such as Best Buy), discount stores (such as Target), or on the Internet (Amazon and Apple, plus many others). In addition, there still is much illegal file sharing of copyrighted digital content. Today, when consumers want to watch a particular movie at any particular time, they have many options.
The U.S. movie "rental" industry has changed. Direct online distribution of content (whether by real-time streaming or downloading for playback) has replaced physical media as the normal method
. Even traditional DVD retail companies like Wal-mart and Target are getting into the digital streaming business
. In addition, many laptops and almost all netbooks and ultrabooks today are being shipped without an optical playback device (i.e., one that can play a CD, DVD and/or Blu-Ray). Obviously, the same is true for smartphones and iPods. In addition to those mentioned above, there also are additional options for receiving digital streaming entertainment, including Internet-enabled TVs, set-top boxes (like Boxee
), game consoles, computers, and readers like the Kindle or Nook. Nonetheless, as of 2010, eighty percent (92 million) of all U.S. households still had at least one DVD or Blu-ray player, leading many to believe the DVD business will retain demand and some profitability for several years to come.
New Competitors and Content
Numerous companies now compete in the shrinking DVD and video game rental industry. Dish Network purchased Blockbuster out of bankruptcy and, in early 2012, has closed 500 of the 1500 remaining stores. Blockbuster, the largest video rental chain in the United States, has launched a variety of initiatives to provide online DVD and game rentals. Dish Network limited the customer base of the current streaming service to pre-acquisition customers and Dish Network subscribers. Recently, Samsung announced (February 20, 2012) a deal with Blockbuster to stream thousands movies to the company's smartphones, tablets, ultrabooks, laptops, smart T ...
The paid TV market is on the precipice of a fundamental change. Internet and mobile video are challenging traditional cable TV for the attention of viewers worldwide. Consumers are demanding more personalized, unfettered content and video service providers must deliver.
This presentation includes an in-depth study of an OTT service in the Indian market. The study further explains how demand surged in the country and how key player is bullish to deliver its content and service to the consumer.
[The Impact of the Internet on the Video Rental Industry.docxdanielfoster65629
[The Impact of the Internet on the Video Rental
Industry: Blockbuster vs. Netflix]
2
Table of Contents
INTRODUCTION 3
VIDEO RENTAL INDUSTRY ANALYSIS 5
BLOCKBUSTER BUSINESS DESCRIPTION 7
BLOCKBUSTER BUSINESS MODEL 7
BLOCKBUSTER HISTORY 8
BLOCKBUSTER SWOT ANALYSIS 10
NETFLIX BUSINESS DESCRIPTION 14
NETFLIX BUSINESS MODEL 14
NETFLIX HISTORY 15
COMPETING ONLINE SERVICES 16
FINANCIAL ANALYSIS 18
THE FUTURE OF THE VIDEO RENTAL INDUSTRY 24
CONCLUSION 25
REFERENCES 26
3
The Impact of the Internet on Video
Rentals: Blockbuster vs. Netflix
Could Brick and Mortar Video Rental Stores be a thing of the past? The Internet has
challenged the way movies are rented in the United States. Blockbuster, one of the
biggest video rental companies, has completely restructured its operations to meet the
market demands due to the emergence of the Internet and companies like Netflix. The
first impact the online video rental industry made on Blockbuster was making late fees
obsolete. Blockbuster enacted a “no late fees” policy in 2004 to remain competitive in the
industry. The company gave up about $450 million in late fee revenue and $250 million
to $300 million in operating income the first year the policy was enacted (Halkias). This
is not counting the increased number of new releases the company needed to purchase to
meet customer demand due to the policy. Under the "no late fees" program, a customer
was charged the purchase price for a movie if it was kept longer than 14 days. The charge
was dropped if it was returned within 30 days, and the customer was then charged a $1.25
restocking fee (Halkias). Blockbuster then created Blockbuster Total Access in attempts
to compete in the online video rental market. With Blockbuster Total Access, customers
would pay a subscription fee of $24.99 a month and rent up to 2 movies online at a time.
4
Netflix, the online DVD rental pioneer, sold a similar service for $21.99 a month.
Company CEO, John Antioco, said the overall online subscriber market is about 3
million to 5 million households, and he believes Blockbuster can attract a 30 percent
market share (Halkias). Blockbuster spent between 70 and 90 million dollars on the Total
Access program in hopes of reinventing itself. Program costs and continued decline in
rentals caused the company’s 2004 earnings to fall about 10 percent below the $1.48 a
share earned in 2003 (Halkias). The company will have to continue developing in this $8
billion dollar a year industry as it continues to change. Within another four years,
customers are expected to spend about $1.7 billion getting movies from cable to watch at
their convenience (Cohen). The video rental industry is also moving to legal downloading
sites such as CinemaNow Inc. Founded in 1999, the service lets people download movies
as a rental with a viewing window, or buy the film outright and burn it on a di.
This was a final project for IMC 618 - PR Concepts & Strategy. This Public Relations plan spanned 9 weeks and was the final execution for my chosen client, Netflix.
For my Capstone at Flagler College, I conducted primary and secondary research to establish a marketing and public relations campaign to deter consumers from pirating Netflix Original content.
How the Digital Revolution is Disrupting the TV Industry Suman Mishra
This is a BCG report on the TV industry in US and it talks about how the TV industry has seen “shifts” from inception, but this time the pace with which its changing is so different. It has done ample surveys and has lot of verified facts which makes this report so rich and conclusive.
The core trends fueling disruption this time are
a. Online and mobile will exceed Facilities based viewing
b. On demand viewing will exceed live, linear viewing
c. New companies and business models in online viewing
d. Networks are experiencing the collapse of the middle and rise of “long tail”
e. Content creators and right holders are capturing a greater value share than ever
The 4 disruptive scenarios in making which will “accelerate” the change are
a. The universal remote: Global, all-inclusive navigation solving the discovery problem
b. The walled garden: exclusive entertainment becomes the critical strategic asset
c. Direct to Consumer takes on traditional TV bundles
d. Live TV online
Q1: What was the source of IKEA’s Competetive advantage at that time?
Q.2 IKEA’s expansion into Europe
Q.3 IKEA’s strategy prior to its missteps in North America.
Q4. IKEA’s strategy towards its suppliers
1. Current Size of Dairy Industry - Locally
World population and per capita consumption of dairy products, 2005, 2008–2016
IMPORTANCE OF DAIRY INDUSTRY TO THE INDIAN ECONOMY
Government to strengthen dairy industry to improve farmer income
Pittsburgh, Pennsylvania- 1869
Best selling brand of ketchup.
From 1906 it was produced without preservatives.
In 1907, Heinz started producing 13 million bottles of ketchup per year, exporting ketchup all over the world.
Heinz manufactures all of its American tomato ketchup at two plants: one in Fremont, Ohio, and another in Muscatine, Iowa.
Heinz ketchup is packaged in glass and plastic bottles of various sizes, as well as individual-serving condiment packets made of foil or plastic.
LABORATORY TEST MARKET RESEARCH DESIGN
SOLUTIONS TO THE CASE
SELECTED FINDINGS FROM THE LTM STUDY
Bitcoin-the underlying technology behind the success of cryptocurrencies is termed as Blockchain.
Creating cryptocurrencies is one of the applications of Blockchain technology. Similarly there are other applications of blockchain as well.
blockchain is literally just a chain of blocks
digital information (the “block”) stored in a public database (the “chain”).
Blocks” on the blockchain are made up of digital pieces of information.
• Blocks store information about transactions like the date, time,
• Blocks store information about who is participating in transactions(Instead of using your actual name, your purchase is recorded without any identifying information using a unique “digital signature,” sort of like a username.)
• Blocks store information that distinguishes them from other blocks.
Once an information is stored on a blockchain, it is extremely difficult to change or alter it. Each transaction on a blockchain is secured with a digital signature that proves its authenticity. Due to the use of encryption and digital signatures, the data stored on the blockchain is tamper-proof and cannot be changed.
MAIN CHARACTERS
AWARDS AND RECOGNITIONS
SYNOPSIS AS A JOURNEY MAP
LEADERSHIP QUALITIES
ANDY DUFRESNE
EMOTIONAL INTELLIGENCE
FRAMEWORK OF LEADERSHIP
WARDEN NORTON
CAPTAIN HADLEY
ELLIS BOYD
Let my people go surfing-Yvon Chouinard - A book reviewRiya Aseef
OVERVIEW OF THE BOOK
PRODUCT DESIGN PHILOSOPHY
PRODUCTION PHILOSOPHY
DISTRIBUTION PHILOSOPHY
MARKETING PHILOSOPHY
FINANCIAL PHILOSOPHY
HR PHILOSOPHY / CULTURE
MANAGEMENT PHILOSOPHY
MESSAGING HIERARCHY
BRAND RESONANCE PYRAMID : Brand Resonance Pyramid (Philip Kotler Summary) ... Establishing the totality of brand meaning in the minds of customers by strategically linking a host of tangible and intangible brand associations.
Big data - Characteristics, types and ApplicationRiya Aseef
CHARACTERISTICS of Big Data
BENEFITS OF BIG DATA
STORING BIG DATA
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Big Data
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data processing
DISTRIBUTED STORAGE
TYPES OF TOOLS USED IN BIG DATA
APPLICATION OF BIG DATA
Starbucks owns nearly one-third of America’s coffee bars.
Almost all of Starbucks’ locations in North America are company-owned stores located in high-traffic, high-visibility settings such as retail centres, office buildings, and university campuses.
He also sold products through non-company-operated retail stores such as hotels, airlines, and restaurants.
Starbucks formed joint ventures to distribute a bottled Frappuccino thru Pepsi-Cola and an ice cream thru Dreyer’s Grand Ice Cream
Coca-cola and PepsiCo came together to refuse and reject the findings of CSE, claiming it to be unscientific and discriminatory.
ISDMA later confirmed that the soft drinks manufacturers strictly maintained all the norms.
American ambassador to India has cautioned that the bad reports would affect the American investments in India.
US government started withholding licenses to Indian banks.
Some newspapers and journals argued about the absence of clear direction from the Ministry of Health.
Edith - product development -advertisementRiya Aseef
BONE CONDUCTION HEADPHONES:
• Bone conduction technology delivers music through your cheekbones, ensuring ears remain completely open to hear ambient sounds.
• Although the sound quality and output is not an immersive experience, you can’t expect it to be as they don’t use earbuds. The speakers are inside the arms of the glasses, which sit on top of your ears. So while the sound isn’t amazing in quality, they do provide good sounding music while at the same time allowing you to hear your surroundings. Listening to music while running can be a safety concern for many runners
• Design ensures maximum situational awareness and comfort during long-term wear.
Market Share: Prestige is India’s brand leader in the kitchenware and appliances categories and commands a ~37% market share in pressure cooker category, 31% market share in the cookware category and ~10% market share in the appliances category.
RMD24 | Retail media: hoe zet je dit in als je geen AH of Unilever bent? Heid...BBPMedia1
Grote partijen zijn al een tijdje onderweg met retail media. Ondertussen worden in dit domein ook de kansen zichtbaar voor andere spelers in de markt. Maar met die kansen ontstaan ook vragen: Zelf retail media worden of erop adverteren? In welke fase van de funnel past het en hoe integreer je het in een mediaplan? Wat is nu precies het verschil met marketplaces en Programmatic ads? In dit half uur beslechten we de dilemma's en krijg je antwoorden op wanneer het voor jou tijd is om de volgende stap te zetten.
Putting the SPARK into Virtual Training.pptxCynthia Clay
This 60-minute webinar, sponsored by Adobe, was delivered for the Training Mag Network. It explored the five elements of SPARK: Storytelling, Purpose, Action, Relationships, and Kudos. Knowing how to tell a well-structured story is key to building long-term memory. Stating a clear purpose that doesn't take away from the discovery learning process is critical. Ensuring that people move from theory to practical application is imperative. Creating strong social learning is the key to commitment and engagement. Validating and affirming participants' comments is the way to create a positive learning environment.
Enterprise Excellence is Inclusive Excellence.pdfKaiNexus
Enterprise excellence and inclusive excellence are closely linked, and real-world challenges have shown that both are essential to the success of any organization. To achieve enterprise excellence, organizations must focus on improving their operations and processes while creating an inclusive environment that engages everyone. In this interactive session, the facilitator will highlight commonly established business practices and how they limit our ability to engage everyone every day. More importantly, though, participants will likely gain increased awareness of what we can do differently to maximize enterprise excellence through deliberate inclusion.
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Who might benefit? Anyone and everyone leading folks from the shop floor to top floor.
Dr. William Harvey is a seasoned Operations Leader with extensive experience in chemical processing, manufacturing, and operations management. At Michelman, he currently oversees multiple sites, leading teams in strategic planning and coaching/practicing continuous improvement. William is set to start his eighth year of teaching at the University of Cincinnati where he teaches marketing, finance, and management. William holds various certifications in change management, quality, leadership, operational excellence, team building, and DiSC, among others.
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The world of search engine optimization (SEO) is buzzing with discussions after Google confirmed that around 2,500 leaked internal documents related to its Search feature are indeed authentic. The revelation has sparked significant concerns within the SEO community. The leaked documents were initially reported by SEO experts Rand Fishkin and Mike King, igniting widespread analysis and discourse. For More Info:- https://news.arihantwebtech.com/search-disrupted-googles-leaked-documents-rock-the-seo-world/
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RMD24 | Debunking the non-endemic revenue myth Marvin Vacquier Droop | First ...BBPMedia1
Marvin neemt je in deze presentatie mee in de voordelen van non-endemic advertising op retail media netwerken. Hij brengt ook de uitdagingen in beeld die de markt op dit moment heeft op het gebied van retail media voor niet-leveranciers.
Retail media wordt gezien als het nieuwe advertising-medium en ook mediabureaus richten massaal retail media-afdelingen op. Merken die niet in de betreffende winkel liggen staan ook nog niet in de rij om op de retail media netwerken te adverteren. Marvin belicht de uitdagingen die er zijn om echt aansluiting te vinden op die markt van non-endemic advertising.
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Implicitly or explicitly all competing businesses employ a strategy to select a mix
of marketing resources. Formulating such competitive strategies fundamentally
involves recognizing relationships between elements of the marketing mix (e.g.,
price and product quality), as well as assessing competitive and market conditions
(i.e., industry structure in the language of economics).
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2. 2
NETFLIX
Netflix is an American media-services provider and production company headquartered in
California. Netflix offers a wide variety of award-winning TV programs, films, anime, documentaries
and more – on thousands of internet-connected devices. The company's primary business is its
subscription-based streaming service which offers online streaming of a library of films and television
programs, including those produced in-house. As of April 2019, Netflix had over 148 million paid
subscriptions worldwide, including 60 million in the United States, and over 154 million subscriptions
total including free trials. It is available almost worldwide.
Netflix's initial business model included DVD and rental through mail, but Hastings deserted the
sales about a year after the enterprise's founding to focus on the preliminary DVD business. Netflix
increased its commercial enterprise in 2010 with the advent of streaming media at the same time as
maintaining the DVD and Blu-ray commercial enterprise. The business enterprise extended across the
world in 2010 with streaming in Canada, followed by Latin America and the Caribbean. Netflix entered
the content-production enterprise in 2012, debuting its first series Lilyhammer. Since 2012, Netflix has
taken more of an active role as producer and distributor for each movie and television series, and to that
cease, it offers a variety of "Netflix Original" content through its on-line library. By January 2016,
Netflix services operated in greater than 190 nations. Netflix launched an expected 126 original series
and films in 2016, extra than every other community or cable channel.
As of 2017, Netflix stocks have been held via institutional buyers, consisting of Capital Group
Companies, The Vanguard Group, BlackRock and others. There are three subscription alternatives a
basic one for Rs 500/month which goes with one device and offers SD resolution video. Then there's the
Rs 650/month alternative which goes with two gadgets and offers HD fine video and sooner or later,
there is the top tier plan that is for Rs 800/month and it really works with 4 gadgets and supports up to
Ultra HD resolutions. Now those costs are barely inexpensive than what's being supplied to customers
in the US. Realistically speaking for Indians, the exceptional plan appears to be the Rs 650/month as
there are very few devices within the market that support Ultra HD video.
3. 3
EFE MATRIX:
Key External Opportunities Weight Rating Score
1 Another 33% of United States consumers switched away from
traditional TV in search of alternatives in 2017
0.12 4 0.48
2 Global number of consumers with access to the internet has increased
by 8% in the past year
0.10 3 0.30
3 In 2017,73% of Americans surveyed admitted to having “binge-
watched” one or more shows for over 5 hours. Over 90% of millennial
had binge-watched, and 38% did so every week
0.07 4 0.28
4 Smart TVs in the United States rose from 46.9% penetration in 2015
to 56.1% in 2016;expected to raise to 60.4% in 2020
0.05 4 0.20
5 Global economic growth expected to rise from 3.0% in 2017 to 3.1%
in 2018,and then decrease back to 3.0% in 2019.
0.04 3 0.12
6 Average household annual incomes in the United States has increased
7% since 2014
0.04 2 0.08
7 Hulu raised over $1 billion (~50%) of its revenue in 2017 from
advertisements, while cable TV earned $71.3 billion (41%) in 2016
0.04 1 0.04
8 Percentage of college-educated or enrolled adults in the United States
has increased steadily since 1970,increasing 1.1% and 0.7% from 2015
to 2016,respectively
0.02 1 0.02
9 Renewable energy costs are quickly falling, notably solar power by
73% in 2017,and expected to overtake fossil fuels by 2020
0.01 2 0.02
10 Number of global mobile phone or tablet users has increased by 19%
from 2013 to 2017
0.01 4 0.04
Key External Threats
1 Pirating is expected to cost Netflix and other streaming services $50
billion in revenue between 2016 and 2022.
0.10 3 0.30
2 Disney plans to launch a streaming service in 2019 to directly
compete with Netflix and plans to remove content from Netflix at the
end of 2018. They also recently purchased 21st Century Fox to acquire
new content and majority ownership of Hulu.
0.10 2 0.20
3 Red Box released a new streaming service in December 2017 to allow
customers to “rent” digital content for a limited time period for $1.99
per title, no subscriptions required
0.08 2 0.16
4 China, with an expected 1.03 billion internet connected users in 2018,
does not permit Netflix to be streamed in the country
0.06 3 0.18
5 Net neutrality repeal in the United States may force Netflix or its 0.04 4 0.16
4. 4
customers to pay Internet Service Providers increased fees for faster
access. This happened previously in 2014 for an undisclosed amount
that increased speeds by 65%
6 Average cost to produce an hour of original TV content has increased
over 300% since 2012
0.04 1 0.04
7 YouTube and Twitch TV, each service taking up 35% of the non-
Netflix audience for online streaming, are based on home user content
with minimal production cost for the company
0.03 1 0.03
8 Other competitors, like Hulu and Sling TV, offer live or day-after TV
episode viewing, rather than waiting for the season to be over
0.02 2 0.04
9 Home DVR devices, which allows for limited video-on-demand
service for traditional TV programming, have increased from 44% of
home consumers in 2011 to 53% in 2017
0.02 3 0.06
10 United States box office sales dropped 1.6% from 2015 to 2017 and
DVD sales dropped 18% in the United States in 2017
0.01 4 0.04
TOTAL 1.00 2.79
5. 5
IFE MATRIX:
Key Internal Strengths Weight Rating Score
1 Revenues increased 32% from 2017 to 2018, resulting in a 121%
increase in operating income and 199% increase in net income
0.12 3 0.36
2 For the first time ever, generated a contribution profit from
international membership ($226 million) and its international
membership surpassed domestic membership by 15%
0.09 4 0.36
3 Gained 25% more subscribers in both 2016 and 2017,broken down to
22% domestic and 109% international
0.09 4 0.36
4 Increased spending on its licensed content library by 23% from 2016
to 2017,now totalling over 140 million hours of content
0.04 3 0.12
5 Grew to 5,500 total employees in 2017, up 800 from 2016,and is
ranked #9 for 2017 Best Company Culture
0.04 3 0.12
6 Increased technology and development costs by 62% since 2015,with
a push to access more internet-connected screens, tap into the smart
home market, and utilize the latest 4K graphics
0.04 4 0.16
7 Offers three different streaming membership levels to suit customer
needs, ranging from $7.99/mo to $13.99/mo
0.03 4 0.12
8 Unlike competitors, has been able to sustain profits without needing
to provide advertisements during streaming. Customers appreciate this
when deciding on a service
0.02 3 0.06
9 Strong seasonality that coincides with purchases of electronic devices,
typically in Q4 and Q1
0.02 3 0.06
10 Published its own internet speed testing website, fast.com, so
customers can see what speed their internet service providers are
allowing for Netflix. This combats attempts against net neutrality and
provides more brand awareness
0.01 3 0.03
Key Internal Weaknesses
1 Majority of content is licensed from others, and negotiations have the
potential to fall through, be withdrawn, or changed
0.12 2 0.24
2 Strongly dependent on internet service providers and electronic
manufacturers for providing access to Netflix
0.08 1 0.08
3 Must create original content, which is more costly to produce than
licensing, in order to distinguish itself from competitors
0.06 2 0.12
4 Net DVD assets halved from 2016 ($25 million) to 2017 ($13 million) 0.05 1 0.05
6. 6
while DVD memberships decreased by 18%. Still currently provides a
55% contribution profit, but is decreasing
5 Many competitors are services provided as part of a parent
organization that have access to other revenue streams
0.05 1 0.05
6 Debt-to-equity ratio has been steadily increasing, with 3.59 in 2015,
4.07 in 2016, and 4.31 in 2017 (20% increase from 2015)
0.04 2 0.08
7 Strong push for international expansion is only beginning to pay off
with a 4% contribution after years of losses, while domestic streaming
has a 37% profit margin and less marketing costs
0.03 2 0.06
8 Despite young adults and college-educated adults having increased
likelihood to subscribe, Netflix does not offer any special benefits to
target this key demographic
0.03 1 0.03
9 Allowing members to stream on multiple screens simultaneously,
combined with account sharing, reduces subscriber revenue
0.03 2 0.06
10 Loose control over third-party contractors needed to stream content
has lead to a poor (“D”) rating in environmentalism
0.01 1 0.01
TOTAL 1.00 2.53
8. 8
STRATEGIC ALTERNATIVES IDENTIFIED BY THE GROUP
To reduce the price structure by implementing a quarterly subscription or yearly subscription at
lower rates as similar to how competitors such as Amazon Prime is currently doing (Bundling
Pricing Strategy).
To include more multi lingual movies would mean to tap a larger market and create new space
(Blue ocean Strategy).
Copyrights for most popular movies are taken on for less than a year. It needs to go through a
proper licensing to get the content for long term in order to retain and establish incoming and
newer customer base.
Netflix should produce fresh content as it is currently releasing it’s own content.
ANALYSIS OF ALTERNATIVES AND FINAL STRATEGY CHOICE
MISSION AND VISION EVALUATION
Netflix has a core strategy or “brand promise,” and values; however, it is missing a formal mission and
vision statement. It is recommended that Netflix develop robust statements that help all stakeholders
understand its business and strategy.
STRATEGIC SHIFTS AND MILESTONES
Since its inception in 1997, Netflix it has achieved many milestones and has also changed up their
strategies multiple times.
In 1999, it began to offer subscription services for monthly price.
In 2002, Netflix became a publicly traded company.
In 2007, Netflix began offering streaming services. In 2011,
Netflix began offering services worldwide.
In 2013, it reached 29 million customers.
9. 9
INTERNATIONALIZATION AND LOCALIZATION STRATEGY
Remember that in more than 190 nations, Netflix is accessible. By using servers strategically situated in
separate areas of the globe, the business is able to achieve its online-based worldwide target audience. It
should be noted that Netflix utilizes Amazon Web Services ' cloud computing platform for a more cost-
effective and worldwide accessible computing capability on a large scale. The firm is able to scale its
operations through cloud computing, make services accessible worldwide, and mitigate the hazards
associated with network outages and bandwidth traffic.
Take note of the California headquarters of the business. Maintaining a worldwide presence and
managing it better In nations such as the Netherlands, Germany, Luxembourg, Brazil, India, Japan, South
Korea and Singapore, the firm has branches and subsidiaries.
Globally operating implies dealing with a diverse target audience with diverse preferences. Netflix also
used a localization strategy as part of its business strategy to address this problem. The firm has obtained
permits not only from Hollywood manufacturers but also from regional manufacturers to distribute
content. Its streaming services therefore also offer drama series from Korea, anime from Japan, movies
from Sundance and other movies and television shows from nations such as the United Kingdom, China
and India, among others.
DIVERSIFICATION STRATEGY THROUGH CONTENT PRODUCTION
Netflix is mainly a video streaming service provider on demand. These video content includes American-
produced television series, movies, animations, and documentaries, as well as other nations such as the
United Kingdom, France, Germany, India, Japan, and Korea, among others. However, to include various
subsidiaries, the firm has diverse its business.
The firm owns and operates three content manufacturing businesses: Netflix Studios based in the US,
Netflix Services Germany GmbH based in Germany, and Netflix Pte based in Singapore. Ltd. These
subsidiaries are manufacturing studios where initial TV shows and movies are produced and co-
produced. Some of the company-exclusive movies and televisions have gained critical praise and a
favorable reception of the public. These include the "Sense8" and "13 Reasons Why" series, and the
"First They Killed My Father" and "To All The Boys I've Loved Before" movies. Netflix's ability to
create or co-produce its own content allows it to encourage the exclusivity of its internet streaming
service, enabling it to compete with studios or production companies and television networks that also
provide streamlining services. The exclusive and original contents also allow the company to attract and
retain subscribers.
10. 10
MARKETING STRATEGY AND MARKETING ACTIVITIES
His marketing strategy and particular marketing operations are a critical element of Netflix's business
strategy. It's important to note that the company's marketing strategy is comparatively simple.
Because it is an online or online business that follows the overall principles of electronic commerce,
Netflix makes comprehensive use of various digital marketing operations. For instance, to keep contacts
with social media users, it retains a social media presence using Facebook, Twitter, and YouTube. In
addition, it also utilizes internet advertising, especially social media ad placements, website and blog
publication, search engines and mobile apps to promote its streaming services and content.
Advocacy strategies are also a critical component of Netflix's general marketing strategy. As a particular
sales promotion tactic, the firm provides a one-month trial period to attract fresh clients to subscribe. It
has also partnered with telecommunications service providers and general Internet service providers to
give fresh or existing clients free or discounted subscriptions while also tapping these suppliers ' current
client base and converting them into subscribers.
Netflix's pricing approach is highly flexible. It provides three possibilities for pricing. The cheapest one
or the fundamental one involves a single-user and single-stream subscription with standard definition
streaming service, whereas the mid-tier or normal choice contains up to two customers and high-
definition streaming double-stream. The high-level and most costly choice or premium plan involves
four consumers who can watch ultra high-definition streaming concurrently. These pricing choices
enable Netflix to target various clients with distinct economic capacities and streaming requirements.
TECHNOLOGICAL STRATEGY AND CAPABILITY BUILDING
The fact that Netflix is an online-enabled company that utilizes electronic commerce's overall principles
or structure implies that it depends on Internet-related technologies and digital communication.
Recall that the business has chosen to use cloud computing or virtualization to achieve its worldwide
target audience and retain regional markets. Cloud computing provides Netflix with several benefits,
including price and operational efficiency due to the lack of the need to construct and retain physical
network and server infrastructure, worldwide scalability, and network and power outage workaround.
Netflix also participates in the growth of software. The firm created and published web and native
applications for various computing platforms such as the Microsoft Windows and Apple macOS
operating systems internet, as well as mobile operating systems for Android and iOS. It updates its
11. 11
applications frequently to introduce fresh characteristics and enhance user experience, allowing internet
consumers to access their services regardless of the platform they are using.
His anti-piracy projects are also component of Netflix's business strategy. The firm worked with other
manufacturers and technology businesses to combat piracy and safeguard their content rights. It has
particular programs for scanning and reporting internet content that has been illegally distributed. The
applications have integrated digital rights management systems that are designed to curb illegal copying
and distribution.
The firm also utilizes machine learning to make automated television or film suggestions available to
subscribers based on their profiles and historical preferences to enhance user experience. The firm also
utilizes machine learning to enhance the quality of streaming, especially by means of a complicated
algorithm and statistical analysis to examine network throughput. Note that the firm has a devoted
department called Netflix Research that aims to capitalize on machine learning advantages for different
business reasons.
OPERATION STRATEGY OF NETFLIX
By constructing their own content, Netflix has extended their company. With original programming that
includes, House of Cards and Orange is the New Black, Netflix will need to continue in the investment
of the production part of the company. Production of original programming has been led by Ted
Sarandos. Mr. Sarandos is the Chief Content Officer (Netflix, 2016). As of 2015, Netflix spent 10% of
their budget on original content. Moving forward they project spending 50% on original content.
Original content development has enormous potential in the U.S. but can also help break into fresh
worldwide markets by implementing content based on consumer preferences in that worldwide market.
Original content in a different language, for instance, content that would be common in different
industries. There may be endless possibilities here but it will come at a cost. Ted Sarandos will need a
strategic team that often measures and reassesses the original content's achievement. A suggestion would
be a five-year strategic plan, with annual assessments showing breakdown content as figures on initial
episodes. The region of manufacturing and content will have to work closely with marketing to
successfully implement the original content strategy.
12. 12
CONCLUSION
Since its founding as a business in 1997, etflix has developed. Netflix has an innovative future to be
excited about from its distinctive strategy of attracting staff to be the leading worldwide leader in the
demand / live stream video sector. Netflix has a brief and long-term plan for its membership to develop
and provide the best for both domestic and global membership. Netflix has possibilities for expanding
membership through worldwide expansion and original content domestically. With good planning,
Netflix will continue to thrive.
13. 13
REFERENCES
Alisha Cottrell.(n.d). Netflix Strategic Plan Analysis. Retrieved from
https://sites.google.com/site/alishajcottrell/ on 6th September, 2019.
Business Strategy Hub.(n.d). An Overview of Netflix. Retrieved from https://bstrategyhub.com/swot-
analysis-of-netflix-2019-netflix-swot-analysis/ on 4th September, 2019.
fastcompany.com.(n.d).Netflix. Fast Company. Retrieved from
https://www.fastcompany.com/company/netflix on 5th September, 2019.