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Netflix Case Study The video rental industry started with brick and mortar store that rented VSH tape. Enhanced internet commerce and also the advent of the DVD provided a chance for a new avenue for securing movie rentals. In 1998 Netflix headquartered in Los Gatos California started operations as a regional online film rental company. While the firm demonstrated a market for online rentals existed, it was not financially successfully. Netflix lost over $11 million in 1998 and as a result significantly changed the business model in 2000. The new strategy included focusing on getting a nationally based subscription model and focusing on improving the subscribers experience on their website. The change in strategic focus has enabled Netflix to grow in the largest online entertainment subscriptions service in the United States with more than 6.3 million readers (Netflix). Netflix first grabbed the attention of several customers when, unlike the neighborhood video rental store, they removed due dates and late fees billed by conventional video rental stores. The Netflix model enables customers to pay a monthly subscription fee for which they get as many movies as they want in a month. The readers order DVDвЂ™s via the companies website and delivered through the United States Postal Service. Subscribers keep the movie as long as they need and when finished return it to Netflix in a postage paid envelop. NetflixвЂ™s derives a much of their competitive advantage from their ability to provide each subscriber convenience and a personalized experience. The firmвЂ™s CineMatch software gathers data from subscribersвЂ™ on line profiles, film rental history along with a subscriberвЂ™s movie ratings to develop a man...