Essay on Netflix Case Study

1. Netflix’s original marketing strategy offered several flat-rate monthly subscription options; in which, members could stream movies and shows via the Internet or have disks sent to their homes in a pre-paid and pre-addressed envelope. Free from the despair of due dates and late fees, members could keep, up to, eight movies at a time. Upon the return of a disk, Netflix would automatically mail out the next movie from the customer’s video queue. Members were able to change and update their queues as frequently as they liked. The sheer innovation of Netflix’s strategy encouraged several competitors to enter the market to compete directly,

The third issue affecting Netflix is the age of movies that they offer to their customers. Netflix cannot deliver the newest movie titles online because they are not offered through VOD for at least a month after they come out on DVD. This is a huge disadvantage to their customers that exclusively use Netflix’s online service. This is the only advantage that Blockbuster still has over Netflix, because if someone wants to see a movie the day that it comes out on video then

Netflix does not allow customers to watch all released movie on demand. There are some movie that customer cannot instantly watch. If Netflix developed streaming service and figure out a problem of coexisting between rentals and streaming service, Netflix can create competitive advantage.

Currently the competitive forces in the movie rental marketplace are not very strong. There are not very many players seeking to gain share in the market. The only competitors that come to mind when thinking of the movie rental marketplace are Netflix, Blockbuster and Red box. The evolution of technology has allowed many people to stream movies from online at no charge, for most and without any required subscription. Places like Blockbuster and Movie Stop are not as vivid as they have been in previous years due to the market shifting

Although most college sports require an intense commitment, college athletes should never receive the title of “employee.” However, many people disagree with this statement, causing a debate about whether or not college athletes should be classified as employees. The issue climaxed when football players from Northwestern College wanted to form a labor union. They believed that college athletes should be treated better in various ways, whether they are considered employees or not (Patterson). While changes are warranted in regards to the organization of college athletics, they are not currently deemed employees.

The movie rental industry is a living industry; there are constant changes with advances in technology, rights management, and the slow, but steady, move away from physical Media. Companies such as Netflix, Hulu, RedBox, and Blockbuster are being forced to look at new business models and try to keep up with these changes.

The five forces of competition of the movie rental industry presents little force against a competitor’s market position based on buyer power, supplier power, and new entrant threats. However, threat of substitutes and rivalry among competitors can affect the amount of profits a company will gain and retain.

Netflix strategy has no brick and mortar stores, big stores with a variety between 300 to 4000 movies in stock. Netflix relies on the internet for customers’ orders and mail system for the delivery. The company does not have late fees, fluctuating monthly fees, predetermined rental periods, instead has a flat fee. Netflix, let customers view unlimited streaming of movies and TV shows for a monthly fee and has also developed platforms to deliver its titles to Nintendo Wii, Xbox 360, PlayStation 3, and TiVo.

Netflix was founded in 1997 with the intent to revolutionize the way in which consumers watch movies and television shows. Their accomplishments both in innovation and in customer base for their service indicate that the firm has been, and continues to be, successful in doing so. Currently, the

With the introduction of new technologies and the development of electronics products, people are now having more opportunities to view movies. However, home viewing is still the most popular way of watching movies. Accordingly, Movie rental has become an industry. This essay will give a detailed analysis of the global leader in the movie rental industry, Blockbuster.

What role has Netflix played in the development of Blockbuster’s strategic planning? How important is Netflix to Blockbuster’s future strategic plans?

Currently, there are only a few stores in existence; “it continues to operate in Alaska and Texas for those last of the hardcore video renters”. Blockbuster will soon be extinct.

Netflix does have a sustainable competitive advantage. According to Wolf, (2006) states Netflix hurt Blockbuster DVD rental by competing with lower prices and mailing out DVDs to people who did not feel like getting out or was in a rush to watch a new movie. Netflix also helped by stopping people standing in lines at a store or the store would be out of

1. While both Netflix and Blockbuster competed on home video rentals, their profit models are the opposite of each other. Blockbuster owned thousands of locations around the US and internationally so that customers could rapidly rent out videos at fixed nightly fees near their local area. Furthermore, late fees were used to maintain their stores available selections by forcing customers to timely return their rented videos and therefore late fees accounted for a large portion of Blockbuster’s revenues. In contrast, Netflix offered mail-in DVD services where it charges its members a monthly subscription and allows them to hold on to a maximum of three videos for as long as they like without incurring additional fees with the condition that the videos were returned in good condition. With this model, Netflix is less profitable when users are frequently exchanging videos because Netflix incurs all postage costs and its users only pay a monthly subscription. Netflix, however, does not bear any fixed costs associated with brick and mortar stores compared to Blockbuster.

Over the past few years the film rental market underwent a major shift. The in-store rental market plummeted by nearly $2 million, while vending machine rentals increased by about ten times the amount and by-mail rentals nearly doubled. However, Video On Demand (VOD) services obtained through cable, digital, and subscription also saw even larger increases. All of these changes meant companies like Blockbuster and Hollywood Video had to either restructure and make a complete business model shift- or face bankruptcy. Meanwhile, the increases for by-mail rentals and VOD subscription, both of which services