Netflix and Consumer Behavior Trends Essay

3135 Words May 5th, 2013 13 Pages
Netflix, Inc. is a subscription-based movie and television show rental service that offers media to it’s subscribers through on-demand internet streaming and DVD-by-mail service. Since its start in 1997, Netflix has taken the movie rental world by storm, becoming the world's largest online movie rental service. As of January 2013 Netflix had a total of 29.4 million streaming customers worldwide (Cohan). Netflix can attribute much of its success to its decisions to follow trends in consumer behavior, while its major competitors, namely blockbuster, sealed their fate by ignoring them.
In the following paper I will tell you how Netflix was able to stay afloat while other movie rental companies failed, and gained success by following trends
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Netflixs main competitor at the time, Blockbuster, chose to ignore these trends in consumer behavior, leading to its ultimate demise; “Netflix almost single- handedly wiped out the retail video rental business. Blockbuster went bankrupt last fall (Kang)”. The article “Why Blockbuster Went Bust While Netflix Flourished” found on Dailyfinance online states “Netflix's corporate mindset has been key to its ability to adapt as people started gravitating toward online video streaming. It's method is to put new technology at the service of customers while keeping a close eye on changing delivery costs and the competition (Cohan, 2010)” Netflix’s strategy of appealing to the consumers need for fast, convenient at home entertainment has proved to be successful. In the fourth quarter of 2012, Netflix reported customer growth of 2.05 million customers in the United States, bringing its total US customer base to 27.15 million. According to Brian Stelter in an article written for The New York Times “Netflix’s fourth-quarter success was a convenient reminder to the entertainment and technology industries that consumers increasingly want on-demand access to television shows and movies. Streaming services by Amazon, Hulu and Redbox are all competing on the same playing field, but for now Netflix remains the biggest such service, and thus a pioneer for all the others. (Stelter)”

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