Netflix Marketing Plan Essay Example
Netflix, Inc. specializes in providing home video entertainment within the video entertainment industry via both DVD’s and instant streaming of video. The company effectively reinvented the video rental industry by using a customer-facing subscription model instead of the standard per-use rental with due dates and penalties.
Netflix has faced turmoil in the past year since its decision to separate its streaming and DVD business requiring customers to pay a separate fee for each service practically doubling the previous rate. The resulting fallout from customers was the loss of more 800,000 subscribers in the third quarter of 2011 (Edwards, 2011). Competitors seeking to take advantage of the company’s weakened position have attempted to increase their share of the market through streaming and online video rentals. Though Netflix has started to regain some of its lost footing, the company has to find new market segments to enter while improving its customer relationships.
Netflix should add video game disc rentals along streaming gaming and live online play options to its product line to compete in this growing industry. The company should also add a discounted bundle pricing strategy to encourage customers to use more services. These moves will increase subscribership and put the company in a position to dominate another home entertainment segment. The company may also be able to attract customers who left in protest to the new pricing policies and increase customer loyalty.
Situational Analysis
The video game industry grows year over year and was double that of music growth in 2011 (Anderson, 2008). There are several internet- companies and kiosk services available where games are rented but only a few are considered strong competitors in the video game industry.
Market Summary
Video game play is a home entertainment media that is popular in many households in the United States and globally. Video game revenues have experienced 5.7% growth from
Netflix has faced turmoil in the past year since its decision to separate its streaming and DVD business requiring customers to pay a separate fee for each service practically doubling the previous rate. The resulting fallout from customers was the loss of more 800,000 subscribers in the third quarter of 2011 (Edwards, 2011). Competitors seeking to take advantage of the company’s weakened position have attempted to increase their share of the market through streaming and online video rentals. Though Netflix has started to regain some of its lost footing, the company has to find new market segments to enter while improving its customer relationships.
Netflix should add video game disc rentals along streaming gaming and live online play options to its product line to compete in this growing industry. The company should also add a discounted bundle pricing strategy to encourage customers to use more services. These moves will increase subscribership and put the company in a position to dominate another home entertainment segment. The company may also be able to attract customers who left in protest to the new pricing policies and increase customer loyalty.
Situational Analysis
The video game industry grows year over year and was double that of music growth in 2011 (Anderson, 2008). There are several internet- companies and kiosk services available where games are rented but only a few are considered strong competitors in the video game industry.
Market Summary
Video game play is a home entertainment media that is popular in many households in the United States and globally. Video game revenues have experienced 5.7% growth from