Netflix Marketing Strategy

In today’s market customers have the advantage of more options in the marketplace. The internet has made it easier by removing the barriers and inconveniences of switching suppliers. For example, a customer can go to Amazon.com to buy a product without even leaving their house.

This is why establishing a relationship with a customer is pivotal to not only keep customers happy but also keep them coming back.

According to Treacy & Wiersema, (1995) in our reading, businesses that use strategies focusing on creating a value to the customers whether it is providing quality products or services, operate effectively (customer service), provide great products at a lower cost, and get feedback from customers about their needs and wants, could in

What the found out was that customers wanted to watch shows they wanted to watch, when they wanted to watch them, versus the shows that networks dictated they should watch and what time they should watch them. (Nocera, 2016) Thus, Netflix changed its strategy to create customer value but also constantly provides new content to keep the customer engaged, therefore, maximizing the lifetime value of each acquired customer. (Khan, 2012) (Nocera,

Netflix’s annual growth has grown from $1.2 billion to six times the rate, $6.8 billion.

According to the New York Times article, if you are a Netflix subscriber, using the Customer Lifetime Value metric, “the lifetime value of a Netflix customer is $291.25.” (Nocera, 2016) Netflix estimates that it cost them $150 to earn each customer and with overhead being very low, they make money not just at the beginning but the lifetime of the customer. Additionally, by tracking customers individually, Netflix can optimize their lifetime value through marketing their products and services to match the individual customer’s needs, called “market of one” (2000). (Kopf,