Streaming Media and Netflix
Table of Contents
Introduction 4 Company and Industry Background 4 Netflix’s Purpose and its Market 4 Current Strategy 5 External Analysis 5 The Market, Industry and Netflix’s Competencies 5 Porters 5 Force Model 7 Competitive Map 8 Key Success Factors 8 Strategy and Business Model 8 Internal Analysis 9 Financial Results 9 Analysis of Financial Performance 9 FIT Strengths and Opportunities 12 SWOT Analysis 13 Issues and Problems to Address 14 Future Vision and Objectives 15 Specific Recommended Actions and Conclusion 16 Appendix 1: Top 200 Titles 17 Appendix 2: BCG Growth-Share Matrix 17 References 17
Executive summary
* Netflix is the current leader in the online video entertainment business. They gained first mover advantage with their home delivery DVD rental system, eliminating the traditional brick and mortar competitors such as Blockbuster and Movie Gallery. Netflix received brand loyal customers through their low monthly prices, the easy to use movie selection navigation software and their large and diverse selection of DVD titles. In 2012, Netflix’s DVD segment lost subscribers due to the popular demand of online streaming. Their long term objective is to shift their DVD subscribers to an online subscription base and they have been successful in accomplishing this objective through the rapidly changing social and technological trends. The environment in this industry is becoming more intense due to the increasing number of rivals. In order to maintain its position as leader, Netflix must retain their strategy of low cost, large library content and enhance customer experience. Their financial results have not been performing well for the last year due to their revenue model of licensing large amounts of content to attract new subscribers filled with debt, which may lead them to potential credit risk. In order for Netflix to gain more market share they should expand internationally and produce more original
Introduction 4 Company and Industry Background 4 Netflix’s Purpose and its Market 4 Current Strategy 5 External Analysis 5 The Market, Industry and Netflix’s Competencies 5 Porters 5 Force Model 7 Competitive Map 8 Key Success Factors 8 Strategy and Business Model 8 Internal Analysis 9 Financial Results 9 Analysis of Financial Performance 9 FIT Strengths and Opportunities 12 SWOT Analysis 13 Issues and Problems to Address 14 Future Vision and Objectives 15 Specific Recommended Actions and Conclusion 16 Appendix 1: Top 200 Titles 17 Appendix 2: BCG Growth-Share Matrix 17 References 17
Executive summary
* Netflix is the current leader in the online video entertainment business. They gained first mover advantage with their home delivery DVD rental system, eliminating the traditional brick and mortar competitors such as Blockbuster and Movie Gallery. Netflix received brand loyal customers through their low monthly prices, the easy to use movie selection navigation software and their large and diverse selection of DVD titles. In 2012, Netflix’s DVD segment lost subscribers due to the popular demand of online streaming. Their long term objective is to shift their DVD subscribers to an online subscription base and they have been successful in accomplishing this objective through the rapidly changing social and technological trends. The environment in this industry is becoming more intense due to the increasing number of rivals. In order to maintain its position as leader, Netflix must retain their strategy of low cost, large library content and enhance customer experience. Their financial results have not been performing well for the last year due to their revenue model of licensing large amounts of content to attract new subscribers filled with debt, which may lead them to potential credit risk. In order for Netflix to gain more market share they should expand internationally and produce more original
References: * Crum, R. (2013) Netflix sees Warner crowding into video market * Retrieved from http://articles.marketwatch.com/2013-04-03/industries/38242123_1_amazon-prime-netflix-s-movies-and-tv-shows