As the CEO of Netflix, I would consider Amazon and Hulu as presenting the greatest challenges to the success of Netflix in the future. Currently, Netflix accounts for 53% of streaming subscription services (Weise, 2016). Two of Netflix’s closest competitors, Amazon and Hulu, account for 25% and 13% respectively, and would therefore likely pose the greatest challenges for Netflix. Recent surveys by Jefferies, an investment banking firm, concluded that many Netflix customers who face a planned 2016 price increase will likely cancel subscriptions (Kim, 2016). Many of these former Netflix subscribers are expected to switch to Amazon streaming services. It is predicted that Amazon will continue to increase direct competition with Netflix and will continue to increase spending on original content …show more content…
(2015). From Temporary Competitive Advantage to Sustainable Competitive Advantage. British Journal of Management, 26(4), 617-636. doi:10.1111/1467-8551.12104
Ingram, M. (2016, February 1). Time Warner loves Hulu, but also wants to ruin it. Fortune. Retrieved October 1, 2016, from http://fortune.com/2016/02/01/time-warner-hulu/
Kim, T. (2016, September 23). Sell Netflix on Amazon competition, Jefferies says. CNBC. Retrieved October 2, 2016, from http://www.cnbc.com/2016/09/23/sell-netflix-on-amazon-competition-jefferies-says.html
McAlone, N. (2015, October 12). Netflix is just too powerful for cable companies to snub — as much as they want to. Business Insider. Retrieved January 16, 2016, from http://www.businessinsider.com/netflix-too-powerful-for-cable-companies-to-snub-says-morgan-stanley-2015-10
Pachter, M., Reese, A., & McKay, N. (2016, September 29). Netflix could lose stream of viewers to Amazon. Barron's. Retrieved October 2, 2016, from http://www.barrons.com/articles/netflix-could-lose-stream-of-viewers-to-amazon-1475163634
Parnell, J. A. (2014). Strategic management: Theory and practice (4th ed.). Los Angeles:
The social issue I have chosen for this assignment is gangs. Gangs are a major issue, especially in poverty-stricken areas. They can create rivals and add hostility and violence into an area. Gangs are a serious problem that police have a hard time solving. Gangs can recruit young adolescents and send them on a path of crime and detour them from a bright future. Each theoretical perspective (the major three perspectives are structural functionalism, social conflict paradigm, and symbolic interactionism) has a different view on the questions they would ask and the way they would examine this issue.
A critical SWOT analysis of Netflix’s social media techniques clearly shows they are ahead of the game and not backing down from rising competitors like YouTube which is gaining viewers by increasing the amount of online content.
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.
“Stock of the online DVD rental company was up more than 15% in early morning trading Thursday. Netflix increased their forecasts for both revenue and total subscribers today, trying to compete with powerhouses like Blockbuster and Wal-Mart. The increased forecast stems from a slew of new subscribers that have invested in the service after a price decrease from $21.99 to $17.99 last month. Despite the increases in revenue and subscribers however, some analysts feel that the business model is “fatally flawed” and the company may fall by the wayside due to competition from the aforementioned retail and entertainment powerhouses.” Investors Guide reported this.
[1] Halal, Bill. "How NetFlix Beat Blockbuster: An Exemplar of Emerging Technologies." William E Halal RSS. N.p., n.d. Web. 09 Dec. 2013.
The idea inspired Reed Hastings and Marc Randolph, and then they founded Netflix in Scotts Valley, California in 1997 (Netflix, 2014). The company comes into play by developing a subscription-based streaming platform for movies and television shows. Unlike the traditional movie rental businesses such as Blockbuster and Redbox, Netflix’s innovation offers service via Internet, and it does not have any physical stores but instead delivers DVDs through postal mail in the U.S. Since then, Netflix has become the world’s leading internet television network with constant growth of customers to over 48 millions members in more than 40 countries in the North America, Europe, and the Latin America (Netflix, 2014). In this analysis, the main focus is examining the current market environment for Netflix. It identifies the type of market structure that Netflix is currently competing. The analysis also expands on the competitions, product differentiation, pricing strategy, and measuring the level of easy entry-and-exit.
Companies like Amazon and Netflix are very effective in predicting what customers normally buy and watch. Knowing what your customers are or are not buying will allow you to position products that they are statistically likely to purchase based on recent transactions and activity. This is a powerful tool for Netflix because it keeps users engaged and actively using the service but also allows them to tailor their investments in content towards items that are more likely to keep users active on their site.
Netherby, Jennifer. “Pressure on Netflix” Videobusiness.com. 29, January 2007. United States Securities and Exchange Commission. (2006). Form 10-K: Net flixr, Inc. Annual Report. Washington, D.C.
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.
In this paper, I would like to analyze Netflix’s distinctive strategies based on their competitive advantage and how it covers from its strategy mistakes in the high threat industry as well as give some viable suggestion for the future development of the company.
The twenty year journey of Blockbuster has not been without bumps, valleys, road blocks, and detours. Blockbuster has come under legal fire from Netflix, a major online competitor, the Free Trade Commission for attempting a host...
Competition – The biggest competitor of Amazon is EBay and all the internet retailers and suppliers as Priceline.com; Buy.com; BN.com and many more.
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. Digitally offering television shows is an area of competition that has previously been controlled by