Preview

Netflix case study

Better Essays
Open Document
Open Document
868 Words
Grammar
Grammar
Plagiarism
Plagiarism
Writing
Writing
Score
Score
Netflix case study
Netflix Case Study
MAR675

Background
Netflix offers online video streaming and DVD rental services for a flat fee to all subscribers. After Reed Hastings, the CEO of Netflix had announced the company 's new strategy of separating its online service and DVD rental services into two accounts for its subscribers, the company’s stock fell to $63 per share from $300 per share and lost 805,000 subscribers in three month. Although facing so many challenges, Reed Hastings choose to continue his new strategies, but with a sincerely apologize for the change and a detailed explanation of why they made this decision and what’s in it for current subscribers. Stock price of Netflix close on yesterday was 312.40.

Problems and challenges
Although it seems that Netflix has recovered from the separation strategy, but there still are some problems and challenges are waiting for the company. First of all, Netflix online streaming branch is facing fierce competition from companies like Amazon instant video, YouTube, iTunes store, and Hulu. Second, On-demand TV offering are now hot area, many big-pay TV operator such as Verizon and Comcast Corp are trying to bring on-demand TV to cable users which will offer fresher content than online streaming companies like Netflix. Third of all, The DVD rental branch called Qwikster are now competing with companies like Amazon and Redbox DVD rental. From what we can see in the future, DVD service may finally run out of business and how to minimize the damage to Netflix is a big problem waiting for a solution.

SWOT
Strength
Netflix is offering a flat fee policy, which is cheaper than Amazon and iTunes users and is easier to retain current users. A very distinctive strength Netflix have is that Netflix is also a producer. In this year’s Emmy Awards, Netflix Inc 's groundbreaking political thriller House of Cards took home an award for directing. As its name shows in Emmy, Netflix may win not only an award, but many potential users.


Cited: Laporte, N. (2013, July 1). A TALE OF TWO NETFLIX. Fast Comapny , 177, pp. 31-32. Mint. (2013, September 23). 'Breaking Bad, ' 'Modern Family ' win top Emmy Awards. (H. M. Ltd., Producer) Retrieved Septemner 29, 2013, from Mint: http://search.proquest.com.rlib.pace.edu/docview/1434860801?accountid=13044 Peterson, T. (2013, September 23). 2013 MEDIA MAVENS: BRAD BEALE. Advertising Age , 84 (33), p. 1. Ramachadran, S. (2013, September 20). Cable Fights to Feed 'Binge ' TV Viewers; Comcast, Verizon FiOS Vie With Netflix, Amazon for Rights to Show Complete Series. (Dow Jones & Company Inc) Retrieved September 30, 2013, from Wall Street Journal: http://search.proquest.com.rlib.pace.edu/docview/1434160601?accountid=13044
Continue Reading
View Writing Issues

You May Also Find These Documents Helpful

  • Good Essays

    Netflix's Timing Of Entry Case Study
    • 717 Words
    • 3 Pages

    Netflix's Timing Of Entry Case Study

    The timing into this industry was perfect. One major advantage was the only other major competitors at the time of creation was blockbuster. Blockbuster and Netflix were both in the business of offering DVD rentals. Where the two separated was the delivery of that service. Netflix allowed customers to receive the DVDs rentals via USPS whereas Blockbuster had stores where customers would come and pick up the DVD rentals. This allowed Netflix to master their brand…

    • 717 Words
    • 3 Pages
    Good Essays
    Read More
  • Powerful Essays

    Bus 800 Netflicks
    • 3279 Words
    • 14 Pages

    Bus 800 Netflicks

    After a thorough analysis of Netflix’s business model including its competitive analysis, SWOT analysis and financial analysis, the three main issues have been identified. The issues include, the intense competition in the home entertainment industry, the suppliers’ bargaining power and the effect of movie-pirating.…

    • 3279 Words
    • 14 Pages
    Powerful Essays
    Read More
  • Better Essays

    MBA611 week 1 assignment Netflix 2
    • 938 Words
    • 3 Pages

    MBA611 week 1 assignment Netflix 2

    Netflix is the world’s leading Internet television network with over 50 million members in nearly 50 countries enjoying more than two billion hours of TV shows and movies per month, including original series. For one low monthly price, Netflix members can watch as much as they want, anytime, anywhere, on nearly any Internet-connected screen. Members can play, pause and resume watching, all without commercials or commitments. (Netflix, 2014) Netflix has changed the way that viewers in the U.S. watch movies with its revolutionary business models. It is now one of the most recognizable online movie rental services in the world. Visionary and charismatic leadership is matched with a keen, professional management team to steer the company’s rapid growth and new initiatives.…

    • 938 Words
    • 3 Pages
    Better Essays
    Read More
  • Good Essays

    Case Study Netflix
    • 599 Words
    • 3 Pages

    Case Study Netflix

    Netflix’s idea was excellent. They had the idea to offer consumers a reasonably low flat fee to rent unlimited amount of DVDs. As fast as a customer could watch a movie and mail it back, the customer would receive another from their rental queue. The customer pays their money and they end up saving a lot on rental fees because they are promised new movies within a day of the delivery of the movie that they returned in a pre-paid envelope. One of the reasons that Netflix has been able to maintain their competitive advantage is the due to many people have already chosen Netflix as their online movie rental choice and it would be very hard for a new comer to take Netflix's business. It would also be very hard to offer the same choices at the same price, and a lower price. Another reason that Netflix can sustain its competitive advantage is due to the theory of first-mover advantage.…

    • 599 Words
    • 3 Pages
    Good Essays
    Read More
  • Powerful Essays

    2010-2012 Netflix Financials
    • 2408 Words
    • 10 Pages

    2010-2012 Netflix Financials

    Netflix has quickly become a household name by saturating the market with a new age way to rent movies. Established in 1998, Netflix geared its business to provide consumers with quick and easy access to their favorite movies without the need to leave their homes. As the business developed and other popular sites, such as YouTube, began to gain popularity Netflix entered the market of streaming online content. During the infancy of their instant service Netflix still relied heavily on mailing DVDs to offer their customers a wider range of movies and TV shows. However, as their steaming library grew the mindset of the company began to shift. As they transitioned away from their mailing movies, key business decisions were made that caused many to question the future of the company. The adaptation of Netflix into the era of instant movie viewing can best be described by analyzing the time period from 2010-2012.…

    • 2408 Words
    • 10 Pages
    Powerful Essays
    Read More
  • Good Essays

    Netflix Swot Analysis Paper
    • 541 Words
    • 3 Pages

    Netflix Swot Analysis Paper

    Furthermore, Netflix made subscriptions appealing to the mass public, by making their products affordable, convenient, fast, and personalized, with the largest content selection of online streaming service.…

    • 541 Words
    • 3 Pages
    Good Essays
    Read More
  • Better Essays

    Netflix Business Plan Proposal
    • 2286 Words
    • 10 Pages

    Netflix Business Plan Proposal

    Hastings, Reed. "An explanation and some reflections." The netflix blog. Netflix, 18 September 2011. 0. Web. 4 Mar 2012. .…

    • 2286 Words
    • 10 Pages
    Better Essays
    Read More
  • Best Essays

    Netflix Research
    • 3337 Words
    • 14 Pages

    Netflix Research

    The quick advancing technology has allowed for a vast majority of Netflix potential customers to greatly enjoy streaming movies and films directly from their home. There are many different devices that would allow for this video streaming to take place. Devices including the PS3, X-Box 360, Wii, Apple products, Internet-connected TV’s, and laptops are able to stream these movies without clicking a remote more then three times!…

    • 3337 Words
    • 14 Pages
    Best Essays
    Read More
  • Good Essays

    Netflix Case Study
    • 577 Words
    • 3 Pages

    Netflix Case Study

    Threat of Substitute Products. This is probably the strongest force Netflix has to battle. On-Demand, Tivo, pay-per-view, and others are all easily accessible substitutes for both streaming and DVD rentals. DVDs are slowly being phased out of home entertainment systems due to technological advancements. This is something Netflix is currently addressing.…

    • 577 Words
    • 3 Pages
    Good Essays
    Read More
  • Satisfactory Essays

    Brief Netflix Overview
    • 255 Words
    • 2 Pages

    Brief Netflix Overview

    The business model that Netflix employs is to offer an unlimited amount of monthly DVD rentals for a small monthly fee. Netflix uses UPS to ship the movies (up to three at a time) to customers. A key part of Netflix strategy is persuading customers into renting movies they had not previously heard of through a ‘You Might Also Like’ type feature. With different articles written daily on select movies, as well as offering suggestions based on past rentals. This allows them to obtain a continued stream of revenue on movies that might otherwise be overlooked at a brick and mortar store like Blockbuster.…

    • 255 Words
    • 2 Pages
    Satisfactory Essays
    Read More
  • Powerful Essays

    Netflix Stock Evaluation
    • 2824 Words
    • 12 Pages

    Netflix Stock Evaluation

    Netflix (NASDAQ: NFLX) forever altered the movie rental market in 1998. By doing as a lot of businesses were at the time, they took full advantage of internet retail. Blockbuster, the international video and game rental hub, was suddenly in turmoil. In 2004, they attempted to counter back with a Blockbuster Online ploy, but to no avail. Netflix, now with over 15 million subscribers, is the largest service for movies and TV series in the world. The ability to adapt and accurately predict progress in technology and consumer needs has allowed Netflix to continue to grow.…

    • 2824 Words
    • 12 Pages
    Powerful Essays
    Read More
  • Good Essays

    Online Experience
    • 657 Words
    • 3 Pages

    Online Experience

    People are turning to online entertainment more frequently. Netflix is one of the most popular streaming and the visual communication it presents is reaching more people in a fresh self-service manner. Netflix rules the industry with over 30 million views a month compared to several other internet visual communication streaming sites that have a lower views (Tejada, 2013).…

    • 657 Words
    • 3 Pages
    Good Essays
    Read More
  • Powerful Essays

    Executive Summary: Netflix
    • 2585 Words
    • 8 Pages

    Executive Summary: Netflix

    What seems to be the major concern or problem regarding the case is what should the CEO of Netflix, Reed Hasting do since he made the decision in 2011 at the headquarters in Los Gatos California of separating the functions of Netflix. The reason people were not happy about Netflix cutting its DVD rental service is because now they have to go to a different website (Qwikster) in order to look for the movies they desired. Also with the separation of Netflix there has been an overall price increase, if one desires to have both Netflix streaming and Qwikster DVD rental. Reed Hasting has caused the company 's share prices to fall thus costing the company money.…

    • 2585 Words
    • 8 Pages
    Powerful Essays
    Read More
  • Powerful Essays

    Competitive Strategy Of Netflix Inc.: Porter's Five Forces Model?
    • 2974 Words
    • 12 Pages

    Competitive Strategy Of Netflix Inc.: Porter's Five Forces Model?

    Netflix Inc. is considered to be in the video entertainment industry, which distributes to consumers through movie theatres, airlines, hotels, and in-home (Inc, 2013). Netflix and its competitors serve in-home…

    • 2974 Words
    • 12 Pages
    Powerful Essays
    Read More
  • Better Essays

    Netflix
    • 1642 Words
    • 7 Pages

    Netflix

    Netflix has continued to prosper in an incredibly fast-paced industry, still with so much room for growth (Appendix 2). With more than two-thirds of all households now owning a DVD player, Netflix caters to all different demographic groups across the United States. They have even reached a younger generation by syncing with the XBox Live gaming system. Unfortunately, there are some factors that keep Netflix from just continuing with what they are doing. Blockbuster has positioned itself in a relatively similar manner to Netflix, causing customers to second-guess which one is better.…

    • 1642 Words
    • 7 Pages
    Better Essays
    Read More

Related Topics