Netflix competitive analysis

509 Words2 Pages
bulb-icon

Recommended: Netflix and their market structure

Competitive Analysis
Blockbuster Inc. and Movie Gallery are currently the two strongest competitors in the market, and therefore pose the biggest threats to Netflix. Amazon, Intelliflicks, and Cleanfilms are all present in the market, but don’t possess enough force at this time to be considered a threat to Netflix.
Blockbuster
As of right now, Blockbuster is the biggest competitive threat to Netflix. Blockbuster was incorporated in 1989 in Delaware and is a major renter of home videocassettes, DVDs and video games throughout the Americas, as well as Europe, Asia and Australia. Blockbuster operated about 9,100 stores in the U.S. and 24 other countries, as of Dec. 2004. In the summer of 2004, Blockbuster launched an online rental program that provides a challenging competitive match for Netflix. Blockbuster’s online debut was in development for years. In 2002 Blockbuster purchased FilmCaddy, an online movie rental company that became Blockbusters internet channel. Blockbuster completed consumer research, both qualitative and quantitative, and found that online customers preferred a program that would give them both Internet convenience and in-store benefits. Blockbuster decided to incorporate its extensive network of stores to provide a powerful competitive edge. In addition, the chain has said it will invest $170 million this year alone in its online-rental operation. Financially, Blockbuster has revenues of 6.10 billion, with a gross profit of 3.61 billion, and a negative ne...

Show More
Related

  • Redbox SWOT Analyisis

    943 Words  | 2 Pages

    Companies like Netflix that have been in the movie streaming industry for many years, and have a large portion of the market for streaming movies make it difficult to others to enter into the online movie rental industry. Netflix has already established a large library of movies and TV shows available for its members. It would take Redbox a number of years and resources in order to catch up with the infrastructure that Netflix already has available and ready for the consumer right now. Redbox would need to analize the opportunity cost of going into a new market or staying and investing in the current kiosks market and making sure that it is the best it can be. Redbox may be subject to others entering into the kiosks market to tap in on a low cost profitable business model. Blockbuster announced the intentions of entering into the kiosks market, which would have taken some of Redbox's share of the profits in a small percentage. However, in 2012 Redbox purchased Blockbuster kiosks business. According to LA times:

    Read More

  • Analysis of Blockbuster Video

    991 Words  | 2 Pages

    In 1985, Blockbuster opened its first store in Dallas, Texas. After the first few stores opened, founder David Cook built a six million dollar warehouse, which could pull and package multiple stores in a day. Blockbuster’s ability to customize a store to its neighborhood, loading it up with films geared specifically to demographic profiles in addition to the popular new releases, and a sizable collection of catalog titles. Blockbuster had instant success. In the early 1980’s and 1990’s Blockbuster put neighborhood mom and pop video stores out of business by offering better selection and convenience. However, success like that enjoyed by Blockbuster can foster arrogance. For Blockbuster, arrogance meant they believed they could do anything within their stores. For example, Blockbuster purchased Sound Music and Music Plus chains. This move took Blockbuster from movies to music. Secondly, this Blockbuster Music meant they were no longer renting now they were selling.

    Read More

  • Blockbuster LLC Case Study

    245 Words  | 1 Pages

    Blockbuster’s competitors, specifically Netflix went public in 1997 and by May of 2002, Netflix was able to attract just under $95 million in its public offering, and this is what caused the decline of the company because between the years of 2003 and 2005, Blockbuster’s market value plummeted by 75%. In 2010, Blockbuster filed for bankruptcy and was bought in auction by Dish Network and remains as subsidiary with only about 50

    Read More

  • Comparing Netflix And Hulu

    832 Words  | 2 Pages

    Both services do share some of the same tv shows and movies, but ultimately in my opinion Netflix has the better option of movies. Netflix has some of the newer movies higher rated movies. Netflix has a better option of classic movies then Hulu has available. Hulu does have access to shows faster than when it becomes available on Netflix, but Netflix does have a larger source of shows than Hulu does. With the new shows that go to Hulu only five are available at a time. While Netflix has access to season of the same shows, so you are available to go back and rewatch the whole series over

    Read More

  • Blockbuster Video Analysis

    1599 Words  | 4 Pages

    The video rental industry was one of the more growing services retailers in the mid-1990s. However, due to Blockbuster, many rental video companies have failed to compete against this category killer. West Coast Video, Video City, and Hollywood Video, which are among the few and only large competitor’s of Blockbuster in the tri-state area. Many family-owned video rental stores could not compete against Blockbuster’s assortment of videos.

    Read More

  • Porter's Five Forces Model and The Movie Rental Business

    908 Words  | 2 Pages

    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.

    Read More

  • Netflix SWOT Analysis

    1425 Words  | 3 Pages

    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.

    Read More

  • Netflix Market Structure

    1515 Words  | 4 Pages

    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.

    Read More

  • Netflix Case Study

    1320 Words  | 3 Pages

    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).

    Read More

  • Analysis of Netflix Social Commerce Strategy

    1491 Words  | 3 Pages

    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...

    Read More

  • The History of Netflix

    2022 Words  | 5 Pages

    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.

    Read More

  • Value Discipline In Netflix

    1232 Words  | 3 Pages

    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.

    Read More

  • Blockbuster Case Analysis

    1489 Words  | 3 Pages

    Blockbuster's origins date back to the mid 1980's when the video cassette recorder (VCR) was the new hype and families all over America were quickly turning to movie rentals as a form of in-home entertainment. David Cook, who previously started David P. Cook and Associates, Inc. to offer consulting and computer services, saw an opening in the quickly expanding movie rental business. Eager to start a business, he jumped in making Blockbuster the Wal-Mart of movie rentals offering a wide variety of movies to customers in a family environment with standout buildings and bright lights. From there, Blockbuster growth exploded bringing in external investors and national attention.

    Read More

  • Netflix

    1034 Words  | 3 Pages

    ...a remarkable opportunity to grow in the industry and lead as an innovative provider, Netflix has much opportunity to satisfy its customers and maintain their attention with their revolutionary business growth (Martala, 2009). Their success goes beyond their product. As stated, it is a combination of their culture of high performance drivers and fosters the “freedom and responsibility” mindset (Elliott, 2010). Because of their innovation and gradual entry into the market, Netflix has the competitive advantage to add layers of products for growth for years to come. Currently, Netflix has the competitive advantage to increase price and retain their current customer base. Even more beneficial, is the opportunity to attract additional subscribers with their new features. To end this, combining their products, price, culture, and strategic plan makes Netflix innovative.

    Read More

  • Netflix Challenges

    1005 Words  | 3 Pages

    1. What is the difference between a. and a. Briefly describe each of the four major challenges that Netflix faces. Which challenge is the easiest to address? Why do you need to be a member? The four challenges faced by Netflix are described below.

    Read More

More about Netflix competitive analysis

Open Document