preview

Netflix Is The Worlds Leading Internet Television Network

Better Essays
Netflix is a movie business that’s offers a variety of ways for customers to view movies. The company offers traditional DVD rental by mail and instant streaming on Netflix-ready devices that could be hooked up to one’s TV. Netflix uses a subscription based model, that allows customers to utilize their services through a per month fee rather than a pay as you go rate. Although the company used to offer a combined subscription rate for DVD rentals and online streaming together, in 2011 Netflix divided these features into the two packages. It is $7.99 for the basic online streaming package and $7.99 for the DVD rental by mail package. If a customer wants to have both features they much purchase both separate packages. Netflix strongest…show more content…
They have done so by creating mutually beneficial relationships with a number of entertainment video providers. Their second main strategy is focused on product differentiation. Not only how customers obtain the content and use it, but also what customers choose what to watch. Netflix’s leading competitive advantage lies within their unique software. The software takes what a customer has watched or rated and based upon that information builds a list of suggested titles similar to ones they have just watched. While other companies like Blockbuster has transitioned into the rent-by-mail niche category that Netflix had started, no other company has customer-profiling software quite like Netflix. It is continuously updating their smart selection technology to keep up with customer needs. Over the past few years the film rental market underwent a major shift. The in-store rental market plummeted by nearly $2 million, while vending machine rentals increased by about ten times the amount and by-mail rentals nearly doubled. However, Video On Demand (VOD) services obtained through cable, digital, and subscription also saw even larger increases. All of these changes meant companies like Blockbuster and Hollywood Video had to either restructure and make a complete business model shift- or face bankruptcy. Meanwhile, the increases for by-mail rentals and VOD subscription, both of which services
Get Access