Netflix‚ Inc. “Netflix‚ Inc. is the world’s largest online movie rental service‚ with more than 10 million subscribers (Netflix Media Center‚ 2009).” Netflix exhibits dominant economic characteristics in the online movie rental business. They enjoy strong market size and growth rate when compared to rivalry competition. The number of rivalries are increasing‚ and the market remains dominated by only a few sizeable rivalries like Blockbuster Video‚ Wal-Mart‚ Walt Disney Movies and Movielink’s
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Background Blockbuster is an American based company in the business of home video rental services established in 1985. In the early years the company entered the market with a bang which was predominated by single stores. The Blockbuster business model was better than its competitors because of the following points: • Large number of copies and broad selection of movies • Conveniently located and highly visible stores • Superior customer service • Optimal pricing and lower costs due to self
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DVDs in shopping areas that are visited a lot. The rental fee is cheap‚ only $1 per night and the whole order and return process is fast‚ simple and easy for the customer. With its many kiosks‚ Redbox built a strong brand reputation. B. Analysis The SWOT analysis shows that Redbox’s strengths are its brand recognition and financial power‚ with being successful it can add more kiosks at good locations. It
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Communication Page 1 Netflix Marketing Plan Industry Analysis There have been many changes in the ways people view movies. Since the invention of the VCR‚ people have been going to a store to rent the latest movie release or view a classic. Now with the advent of the Internet‚ people have many different media to view a movie. They can download from a website‚ view in a video player‚ or stream the video from a vendor’s website. This was made possible because of Netflix. Netflix pioneered the way
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1. Analyze Blockbuster’s current position (based on its brick-and-mortar business model) using Porter’s 5-forces model. What are the conclusions of your analysis? In Porter’s 5 forces model‚ the five underlying forces for an industry’s structural attractiveness are the barriers to entry for new competitors‚ the intensity of rivalry among existing competitors‚ the threat of substitute products or services‚ the bargaining power of suppliers‚ and the bargaining power of buyers. In analyzing Blockbuster’s
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Strategic Report for Netflix‚ Inc. Hillary Carroll Alex Menenberg Ian Kwok April 20‚ 2009 Netflix‚ Inc. Table of Contents Executive Summary..........................................................................................................................3 History .............................................................................................................................................5 Business Model ............................................................
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Table of Contents Company Overview 4 Issues 5 Analysis External Analysis Dominant Economic Feature 8 Competitive Forces Five Forces Model 10 Driving Forces 12 Key Success Factors 14 Competitor Analysis 15 Industry Attractiveness 21 Internal (Company) Analysis Company Strategies 21 SWOT Analysis 23 Value Chain Analysis 29 Competitive Strength Assessment 30 Strategic Issues and Obstacles
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Blockbuster became the dominant movie rental firm for a number of reasons. First and foremost in the early years‚ they were invested in by Wayne Huizeinga who infused the company with $18.5 million dollars and for a span of 7 years grew the company’s market capitalization at an annual growth rate of 118%. Once it started becoming large‚ it efficiently used economies of scale. It also had the most power to negotiate favorable deals with movie studios as opposed to mom and pop shops. Blockbuster
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where pay-per-view programming merges with Internet downloading. Netflix‚ an online subscription-based DVD rental company‚ entered the video industry with disruptive technology of offering online video rental while the incumbent competitors like Blockbuster were offering retail rentals. The incumbent competitors eventually followed Netflix’s direction when their core competencies were sabotaged by Netflix’s strategy. Moreover‚ Netflix was a technological leader that invested in new technologies like
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infrastructure growth. The consumer base was the final objective Netflix sought to achieve. Retaining and growing subscribers were fundamental to revenue and marketing goals. Marketing Strategy To meet marketing goals and objectives the company implemented Michael Porter’s approach to strategy and relied heavily on strategic alliances. Porter’s notion of differentiation and focusing on specific markets were used to set Netflix apart from competitors and build a customer base. Employing strategic
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