QUESTIONS FOR DISCUSSION
As completely as possible, sketch the value chain for Netflix from the production of content to viewer.
This movie rental company enables customers to get a membership (monthly) in which for less than $10 dollars they get access to movies on DVD in their mail. Still this fee depends on the amount of DVDs the people wants to get. The due-date doesn’t exist; the loan goes as far as the consumer needs it. When returning a DVD there is just a prepaid return envelope, the viewing experience is conditioned by the quality of the connection depending on the midst. The Netflix movie viewer tries to optimize the view.
How does horizontal and vertical conflict impact Netflix?
For these types of conflicts there’s no simple recipe for avoiding channel conflicts. In fact, conflicts can only be minimized, not avoided. Netflix could be affected by these episodes in economic terms. Although they don’t have many alliances with distributors because of its scope in the web (which can reach any computer by typing the netflix’s address) the conflict will relapse in a horizontal conflict in which suppliers can provide their competitors with the same material.
How does Netflix add value for customers through distribution functions?
When referring to distribution functions we talk about scope and market share, for that reason Netflix has to establish strategic relationships with television cable and alliances companies (clearly for television). For example, Direct Tv has its own movie channel in which people can interact as in the web right at their room. Also, Netflix has another competitor to watch out for. Movie Gallery's principal activity is to provide retail home video in rural and secondary markets. They offer a wide selection of movies and video games for rent and sale. Movie Gallery has developed and implemented a flexible and disciplined business strategy that centers on driving revenue growth, maximizing store level...
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