Strengths
- Focused on sportswear and business suits to get good prices from suppliers.
- They can place very large production orders.
- They have and excellent customer service and a good logistic.
- Their catalogue system is very popular.
Weaknesses
- They did not follow customers from minorities (Afro American, Hispanic…).
- They did no televisions and radio advertisement.
- Their products quality is low, due to low costs manufactures from Asia.
Opportunities
- They invested in information system to analyse customer behaviour.
- The number of households accessing internet grew increasingly.
- They got a partnership with ASI, which already got some custom fit patterns.
Threats
- Their principal competitor, L.L. Bean was well recognized for its customer service too.
- L.L. Bean introduced a well-designed e-commerce website.
- Nike appeared on the custom fit market.
Netflix – Porter 5 Forces
1. Threat of new entrants
Profitable industry
Large capital expense
Complex logistics
Law streaming costs
Moore’s law
2. Threat of substitutes
Consumers treat each product differently
Passive entertainment
Kindle, iPad, videos games, web surfing
Interactive social media
3. Bargaining power of buyers
Tiered pricing strategy
Eliminating cost
Piracy
Blacklist profit
4. Bargaining power of suppliers
Control delivery, content timing
Complex strategic alliance
Litigious Industry
Large studios
Strategy and the Internet – Porter
Michael Porter explains that Internet is a new technology and that it provides better opportunities for companies to institute strategic positioning than before. Internet may totally change industry organization by decreasing the profitability.
The question is how to deploy Internet technology. Because it gives competitive advantage to one company from another and doesn't even require new strategy. In order to succeed Internet must be used as a compliment to traditional competition.