(Solved Homework): Discuss the various levels and types of strategies the firm (Netflix) may use to maximize its…

Discuss the various levels and types of strategies the firm (Netflix) may use to maximize its competitiveness and profitability.

Expert Answer

Netflix, Inc. is the world’s largest streaming platform for television shows and movies on the internet. The company was originally launched as a website that allowed consumers to rent DVDs and have them delivered directly to the consumer’s homes. Shortly a while after, it started offering a subscription for consumers to purchase, to receive unlimited DVD rentals monthly via mail with a prepaid mailer that would send the DVD rental back to the company. It was a means for consumers to avoid late fees for not returning your DVD rental to the DVD rental store.

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Located in Los Gatos, California, Netflix began streaming content over the internet in 2007, launching itself into the world’s largest internet subscription service to offer streaming movies and TV episodes. The company delivers streaming through software that is available on hundreds of “Netflix Ready Devices” . Today, Netflix, Inc. has directed its focus on consumers who want to subscribe to commercial-free streaming of television shows and movies, changing the way consumers are enjoying in home entertainment opportunities.

In order to maximize its competitiveness and profitability, Netflix did the following –

  • No due dates, No late fees, No concellation fees
  • Free DVD shipping – both the ways shipping
  • Blue ray substitution for a fee
  • Customer centric and excellent customer services
  • Monthly subscription based service
  • Patented method of web based DVD selection
  • Consistently maintain 84% to 86% of existing customers quarter over quarter
  • Low overhead costs lead to huge profitability – No store rents, utilities and salaries
  • Strong financial growth


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