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What is netflixs market structure
Netflix strategic position in industry
Marketing analysis on Netflix
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Generation after generation flies faster than an airplane and passes faster than ever. Technology would change as the time passes too. Over the past years technicians and technologists do their best to offer younger generations better options and technology to climb steps in the society to be better and better. Technologists and technicians do their best to find faster and cheaper ways that we can use in everyday regular uses. Netflix as an entertaining company did not have an easy start. Sense this company did their best trying to achieve our desires we should know more about the origin of Netflix and their way up to success and fame.
Literature Review
Hastings (2005) stated that Netflix was originally a single rental service until more
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Netflix got affected by us and we got affected by it too. When a big entertaining company like Netflix provides all of our daily needs we as humans naturally use what's easier for us and they in return benefit too. As a result of this exchange Netflix now do their own movies and TV shows, which makes them successful as time passes.
Success, not fame. Hasting (2005), the creator and founder of Netflix mentioned that he created Netflix for one reason Success not fame. He was an engineer who had an idea. He believed in knowledge and technology and as a result of that he created Netflix. Hasting knew that a lot of problems would face him, but he took risks because he had a goal to achieve. And that proves that you will only learn and succeed by struggling.
Making history, not money. According to Mcalone (2016) Netflix made a lot of history by mailing DVDs, with no late fees, great selection, recommendation system and a good pricing too. They made us especially young generation to believe in their network by making us try a whole free month of free movies and TV shows and they were smart by doing that because us as a younger generation drag our parents and elders into new technology and fashion. Its obvious they made money, but they didn't stop there they offered us more options and movies for us
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A lot of arguments had been made about how Netflix now and how it's grabbing attention from all the other companies and not giving anybody else a chance as mentioned by Perry (2015). Netflix fought all the way through to get to the top and they never failed their customers in anything. Although they knew that it wasn't easy to produce original material they did their best and succeeded at it mentioned by Nocera (2016). A lot of people looked back at back at the origin of Netflix and their story of success and it was full of struggles, competitors, decision making and a bunch challenges. Lev-Ram (2016) talked about their smart strategy to get more subscribers. They used young generations, categorized the options into family, kids, teens, which made it a lot easier and provided to a bunch of people to choose
A major strength that Netflix has is their ability to push for such innovation. They have reached new lengths since their start in 1997. From in-mail DVDs, to streaming media on smartphones and tablets, it’s unbelievable to witness this in the making. I think the world is a little shocked on the technological advances of Netflix. What they have done so far is spectacular and it is all because of innovation. New ideas and new strategies developed over the last fifteen years has lead Netflix to where they currently stand today. They currently have a subscriber base of over 700, 000, offering thousands of titles on many different devices. This was made possible because of their ability to innovate and strive for new technological advances. I consider Netflix a very brilliant company. Their strengths are very clear, but this isn’t to say that they have no weaknesses. Netflix has far more competitors now, than they had 15 years ago. I would say that their biggest weakness is not offering enough newer content. Some of their competitors such as Hulu, offer a ridiculous amount of new content. Netflix seems to have a large amount of titles, but majority of these titles are older titles. They need to offer newer titles more often than less. With the company advancing and technology on the rise, the younger population aren’t into the older titles. The younger population now take up a good chunk of the customer base. Netflix must
According to the history of movie rental, home video, and gaming, Netflix was the first company to introduce the movie rental service back in April of 1998 and offered more than 900 titles (Lardener, 2010). Ever since, the industry has become larger with new technology such as online streaming and next day delivery. Also, more competitors are now available and provide the same services, such as Amazon, Wal-Mart, blockbuster, and Redbox kiosks.
Since any other form of entertainment is considered a substitute, Netflix?s industry is in direct competition with all other forms of entertainment, whether it be reading, physical exercise, regular television, etc. If trends in popular culture move away from those related to movies, revenues may be affected.
It has movies that you can't find anywhere else. Netflix uses collaborative filtering technology to send you emails that alert you to movies that you might otherwise never consider. Netflix saw the video- and game-rental market move to DVD and built its business around that trend. Netflix doesn't rent videocassettes, only DVDs (in part because they're lighter and cheaper to mail). Netflix was able to identify and implement a strategy for growth through product and services acquisition, by turning what seemed like an unprofitable rental business into a rental driven financial blockbuster.... ...
When using Netflix, the client has the option to watch movies online at their convenience, an option that Redbox does not offer. Receiving movies in the mail is optional while using Netflix services. Unlike Redbox, Netflix offers more than just movies, they also offer television shows and Netflix Original series. Redbox is strictly movies and games for now. Netflix even allows their clients to access their movies or television show on mobile devices, using the app. This service is more appealing to the younger generation and less mobile movie watchers. The Netflix user can watch their favorite movie or television show while traveling, something Redbox users cannot do. The Netflix user can even access the Netflix app through their home entertainment system. If the Netflix user wants to have family movie night at the spare of the moment it would be more convenient rather than going to a local Redbox location to rent a movie. Netflix offers a wide variety of new and old hits. If a person has limited mobility Netflix will be the best choice for them. If a person is bad about not returning movies on time, or simply just wants to watch the movie more than once, Netflix will be a life
[1] Halal, Bill. "How NetFlix Beat Blockbuster: An Exemplar of Emerging Technologies." William E Halal RSS. N.p., n.d. Web. 09 Dec. 2013.
In conclusion, the vast technology change opens many opportunities for Netflix to grow. By assessing the market environment and challenges, it enables Netflix to overcome the obstacles to remain as the market leader. To achieve the future growth, Netflix should implement both strategic and tactical approaches to compete with others. The strategic and tactical business plans for Netflix are improving content libraries, developing more partnership with production firms, and staying with the low-pricing strategy.
The video rental industry began with brick and mortar store that rented VSH tape. Enhanced internet commerce and the advent of the DVD provided a opportunity for a new avenue for securing movie rentals. In 1998 Netflix headquartered in Los Gatos California began operations as a regional online movie rental company. While the firm demonstrated that a market for online rentals existed, it was not financially successfully. Netflix lost over $11 million in 1998 and as a result significantly changed the business model in 2000. The new strategy included focusing on becoming a nationally based subscription model and focusing on enhancing the subscribers experience on their website. The change in strategic focus has allowed Netflix to grow into the largest online entertainment subscriptions service in the United States with over 6.3 million subscribers (Netflix).
Netflix was established by Marc Randolph and Reed Hastings in 1997 in California. Initially, the company offered a DVD-by-mail service for a monthly, flat rate subscription fee. Videos were sen...
From its inception, Netflix has become a business based on superior customer service and has subscribed its business to the market marketing management philosophy. The main purpose behind Hasting’s idea of a better way to rent and enjoy movies was how to provide that service to their clients and not have any late fees. In other words, their customers could enjoy their rentals from Netflix for as long as they wanted, and they would never have to worry about late fees again, so long big movie rental chains! This aspect alone of Netflix’s marketing plan indicates that Netflix has based their marketing plan on market orientation, “a philosophy that assumes that a sale does not depend on an aggressive sales force but rather on a customer’s decision to purchase a product,” (Lamb, 2009, p.7). Many companies that take on this philosophy are said to implementing the market concept. The marketing concept states: “The idea that social and economic justification for an organization’s existence is the satisfaction of customer wants and needs while meeting orga...
Reed Hastings, co-founder of Netflix headquartered in Los Gatos, CA, began the company’s operations in 1997 after receiving an enormous late charge from a movie rental he returned long overdue. However, Hastings had the desire to be different than traditional movie outlets; whereas, customers had to drive to the location, pay a certain amount for each movie they rented, and were given a deadline in which to return the movie. Instead of using a method established by other video markets “to attract customers to a retail location, Netflix offered home delivery of DVDs through the mail” which eventually led to a booming business towards streaming forms of entertainment (Shih, Kaufman, & Spinola, 2009, p. 3). Today, Netflix exists along with several competitors; however, offers the most streaming content available for viewing, and continues to grow its subscriber base both domestically and globally. Although, direct and indirect competitors, acquisition costs, and several barriers present a financial threat for Netflix, the company has managed to grow with the acclamation of partnerships, expand to international territories, and vastly increase its price in shares of stock.
As the firm moves forward, top managers must pay attention to staying unique to sustain a competitive advantage. Netflix does not own their content, nor do they have any tangible assets. Netflix is a part of a broad range of network users. As technology continues to grow exponentially, Netflix will have to be readily adaptive to change and innovation. Technology never stops growing and evolving, therefore, Netflix’s business platform should never stop growing and evolving. At the same time, they must be careful to remain user friendly and customer centric by keeping the technology at a level where users will not have to obtain a certain set of technological skill sets.
Video Rental and Streaming has partly been of the most significant avenues of the general home entertainment industry in the United States for many years. It promotes constructive development through various channels such as Information Technology, Public Multimedia and it also has a huge impact on people’s lives and their entertainment on demand. One of the best companies which provide this high-advanced service is Netflix, Inc (Netflix). It was incorporated on August 29th in 1997 in California by Reed Hastings & Marc Randolph; listed on NASDAQ as NFLX in 2002. Netflix is the world’s largest Internet subscription service streaming television shows and movies with over 40 million members in 40 countries (Netflix, 2013).
Reed Hastings (co-founded) founded Netflix in 1997. During this time, Netflix offered DVD rentals by mail. As Netflix went public in 2002, shortly a year later their subscription reached the one million mark (Netflix Management, 2011). Recently, Netflix is recognized as one of the 50 most innovative companies, ranking number eight for “streaming itself into a $9 billion powerhouse (and crushing Blockbuster)” with 20 million subscribers (fastcompany.com, 2011). This success shows how Netflix embraced a business approach where their mission was to take the troublesome experience of everyday consumers and transform them into a business opportunity. Below illustrates how Netflix rank in other categories.
1) Netflix’s currently does not have a user-friendly method for customers to stream videos onto television sets. Netflix is entering agreements with the manufacturers of game systems, Blu-ray disc players, and televisions to include software capable of streaming Netflix videos. 2) There is strong competition with other companies that offer video streaming at no extra charge. Additionally, Netflix and its competitors are attempting to enter the digital world.