Strengths And Weaknesses Of Netflix

2. What forces are driving changes in the movie rental industry? Are the combined impacts of these driving forces likely to be favorable or unfavorable in term of their effects on competitive intensity and future industry profitability?

Netflix was founded in 1997 with the intent to revolutionize the way in which consumers watch movies and television shows. Their accomplishments both in innovation and in customer base for their service indicate that the firm has been, and continues to be, successful in doing so. Currently, the

There are a lot of strong competitors: Blockbuster, Apple, Red box, and etc… Beside, product in this industry is not differentiated. On the other hand, the products and services are not difficult to imitate. This market is very competitive.

The third issue affecting Netflix is the age of movies that they offer to their customers. Netflix cannot deliver the newest movie titles online because they are not offered through VOD for at least a month after they come out on DVD. This is a huge disadvantage to their customers that exclusively use Netflix’s online service. This is the only advantage that Blockbuster still has over Netflix, because if someone wants to see a movie the day that it comes out on video then

Brand name – Netflix is priced higher than other competitors, meaning the consumer is probably associated with middle and upper class based on wealth and can increase social status.

Netflix needs to stay with the current trends of customers world-wide, keep creating Netflix original series, and keep updating their system when new devices are invented or entertainment improves. Netflix is a phenomenal way to stream the best content that is currently available to users and if they continue to provide excellent customer service at an affordable rate then I will continue to be a loyal customer for many years to

First formed in 1991, Netflix has become today’s predominant video rental service. They offer a hybrid service allowing DVD delivery by mail as well as streaming movies and TV shows via their company website or access on 200 other devices. Their unique business process has netted them over 16 million subscribers and revenue around $500 million annually. The reason for their growing success can be attributed to a good business model and just as important, properly implemented systems. An extremely efficient supply chain management system (SCM) and customer relationship management system (CRM) have helped Netflix become the world’s largest video subscription service.

For netflix's business portfolio they outline that their main area of focus are online DVD rentals via online streaming (Netflix ,2010). It is clear from this that netflix have outlined that they aim to provide a service that they hope many people across a broad market will be able to use. With this in mind they would be able to generate a large revenue. Netflix is operated on the basis that you pay a monthly subscription and in

Netflix is able to offer its customers a flat monthly fee for services, no contract requirement, no late fees, a large variety of television shows and movies, in a convenient way, at a reasonable price.

Netflix inventory of approximately 75,000 is significantly larger than the average video rental store. The average video rental store has approximately 5,000 titles. Traditional video rental stores rarely stock sufficient copies of popular releases to meet demand. Customers unsuccessfully seeking a particular title may leave without making a selection. The large inventory of creates added customer value through

Also Netflix needs to prepare a better plan to recover old customers, gain new customers and make sure that the people who still have Netflix keep it. Establishing a bundle price for both online streaming and DVD rental will allow The Netflix Company to recover some market shares and remain the leading overall digital film company. The recommendations are as follows:

Netflix, the online subscription-based DVD rental service aimed to better satisfy customer in a way competitors didn’t, customized and personalized service with unlimited monthly rentals from a great variety of film offerings. Now they want to leverage their strengths to enter into the Video on Demand market

Currently, there are only a few stores in existence; “it continues to operate in Alaska and Texas for those last of the hardcore video renters”. Blockbuster will soon be extinct.

Video-on-demand or VOD, a service that allows users to select and watch videos over the internet, will be one of the greatest innovation as stated in the Netflix case study. It will be a great opportunity for Netflix, but it will also be a challenge to integrate or do away with its current business model. Its current business model is one that relies on the internet and the post service to deliver DVDs to its subscribers. Netflix should carefully enter the VOD market without doing away with its current model. This will allow it to maintain its growing position as a giant in this media industry. In order to better understand Netflix and the problems it faces, we must first identify its strengths. What does Netflix offer its customers that its competitors do not? What differentiates it from its competitors?

Netflix is recovering from one of the worst self-inflicted corporate marketing gaffes in years. After years of offering an excellent value to customers purchasing its unlimited single DVD and streaming services for only $9.99 a month, Netflix unexpectedly announced that it would be completely separating its DVD service from its streaming service, causing a price increasing of 60% to $15.98 for customers who wanted to keep both services. Overnight, Netflix angered many of its very loyal customers and lost over 800,000 of its 24.6 million members due to the debacle [1]. Adding fuel to the fire, Netflix decided to actually create separate brands and separate websites for the two services, keeping the Netflix name for its streaming services