Netflix SWOT Analysis

The advantage that Netflix has is convenience. Their customers find it easy to browse and rent movies, while having them delivered in a minimum amount of time. 4. Netflix is based mainly on movies, while Blockbuster, Wal-Mart, and others also carry a selection of video games and a wider collection of genres. Wal-Mart carries a name that attracts many customers due to the low prices and the company name.

There are over 100 shipping location in the United States. Netflix offers over 100,000 DVD titles and over 8,000 that are ready to be watched instantly on a subscribers PC. Netflix has over 1500 fulltime and 1100 part time employees at their headquarters and shipping centers. This had made Netflix the top ranked e-commerce company in customer satisfaction and that is causing a rapid growth in subscribers, revenue and earnings. How does it work?

Meanwhile, Netflix might keep the customers who try the service and happy with it continue paying the monthly fee. Therefore, Netflix has less problem in predicting revenue or level revenues. * Being an on-line DVD rental store, Netflix combines the growing Home Entertainment Market and the Internet. Unlike brick-and-mortar video rental business, Netflix incurs less overhead because no storefront is required and less employees are hired. Movies are sent to customers in prepaid envelope within 24 hours after the customer returns a movie.

Why not Hulu or other providers? Hulu may get TV shows the day after they air but Netflix has significantly more shows and movies in general. Both Hulu and Netflix work on mobile devices, game consoles and link to social networks. Thor Jensen, author of the article Netflix vs. Hulu Plus states that “with the correct hardware, Netflix offers the best experience in streaming.” Netflix also has little to no ads, while Hulu depends on them. Offering ad free streaming has proven to be quite a leg up in the competition in terms of allowing subscribers to enjoy their favorite shows almost instantly.

The affiliate program encourages other websites to provide links to Netflix and offers a referral fee for linked new members at a range of $9-$12 per member. This fee is dependent upon the number of referrals provided in a month. If a site is successful at delivering greater than 200 new customers in a month, the referral fee is negotiable, up to $30 per new customer. Netflix is a straightforward company. It rents DVDs via the Internet and sends them to you through the U.S.

Redbox Strategy Analysis Introduction This analysis takes an in depth look at the movie rental industry and more specifically Redbox. Redbox is the only company that has taken advantage of the in-between state of technologies that we are currently in. The movie rental industry has traditionally been, renting hard copies of movies in brick and mortar stores with thousands of retail titles. Technology has advanced so fast that it is clear to see that the future of home movie rental lies in wireless downloads and streaming movies instantly. However, the success in the movie rental industry is not solely determined the method of renting and technology.

According to Smith (2015), “the new model should give Netflix customers better-looking content while using 20% less bandwidth. That’s a huge deal for customers, particularly in areas with slow internet speeds across the US and abroad.” The technological segment affects Netflix in many ways. For example, the technology helps Netflix to be a leader in the online video streaming service and DVD industry over other competitors, including Amazon prime and Hula (Williams, 2015). The technology makes Netflix attract more subscribers in a very short time (Williams, 2015). According to Williams (2015), “Netflix is certainly streaming at scale.

The Netflix model allows customers to pay a monthly subscription fee for which they receive as many movies as they want in a month. The subscribers order DVD’s via the firms website and delivered through the United States Postal Service. Subscribers keep the movie as long as they want and when finished return it to Netflix in a postage paid envelop. Netflix’s derives a much of their competitive advantage from their ability to offer each subscriber convenience and a personalized experience. The firm’s CineMatch software gathers data from subscribers’ online profiles, movie rental history and a subscriber’s movie ratings to develop a person... ... middle of paper ... ...iding convenience, selection, personalization and a low cost method for product delivery.

Netflix has more than 40 million subscribers who have access to more than 100,000 titles as on mid-2013 (Netflix, 2014). They have more than 42 shipping locations and ships over 1.575 million DVD’s to subscribers on daily basis (Netflix Competitive Advantage, 2010). In USA the highest ISP speed is 2.97Mbps which is provided by cable vision-optimum. Netflix together with YouTube accounts holds for over 50% of downstream traffic on fixed networks. Its design and traffic management play key roles on its network infrastructure (The ISP Speed Index, 2014).

Since most viewers subscribe to a handful of these competitors, and few have switching if a new competitor emerges with greater streaming capacity and lower prices, Netflix’s business model could be severely jeopardized. STRATEGIC OPTION The analysis of the company reveals that the performance of the company shall be improved and enhanced with the selection of the accurate and befitting strategic option. Netflix is the largest online movie rental service provider and offers a library of over 100,000 DVD titles, 12,000 of which can be streamed instantly online, to its ten million subscribers. Netflix’s DVD titles include movies, television, and other filmed entertainment products. Along with an extensive collection of titles, the Netflix service also includes access to movie ratings, reviews, and personalized movie recommendations.