Effects of E-Commerce: Netflix

By: Janelle Barry, Chris Caponigro, Joel Eisenschmidt, Will Siembor, Frank Tufano

Introduction Netflix was established in 1999 Originally only offered DVD rentalsAs it grew as a company and competed in

the industry it became stronger and more innovative

In 2007, it began streaming movies, TV shows, and documentaries via the internet

Over 40 million subscribers worldwide

Influence on Consumer Decision Making Process Netflix introduced a quicker and easier way of delivery with no due dates.Netflix figured out the optimal entertainment delivery system: Streaming.Choice of entertainment. Instead of the traditional ways of playing for basic

cable, seeing movies in theatres and renting them at Blockbuster, many consumers just chose a Netflix subscription.

On the consumer side, people are choosing to view entire series in order instead of watching whatever rerun is on cable. It’s so easy for people to choose whichever series they want.

On the industry side, the people that own the rights to these shows and movies are making more money than ever, as they’re getting more air time since people can choose to view them whenever they want.

Effect on Consumer MarketNetflix accounts for 31.6 percent of all downstream Internet traffic, while competitors

like Amazon video use 1.6 percent and Hulu using 1.3 percent. Physical video rentals started to diminish with instant streaming via the internet.Acquired over 10 million new subscribers in 2012.Related to new original programming, (House of Cards, Orange Is The New Black,

Arrested Development, etc…)Netflix is giving consumers an alternative to paying a cable subscriptions and that

market is around 100 million households paying on average $90 a month when Netflix streaming cost is only $7.99 a month.

Revolutionizing the way physical media is acquired through instant streaming has been Netflixs strongest asset, as is its different platforms and devices it can be viewed on.

SWOT AnalysisStrengths- It’s strengths are weighed primarily from

it’s concept of easy, quick, and efficient Can be used on many different platforms and devices,

streaming through the internet, ability to partner with several other companies, and the endless amount of media content produced

Weaknesses- Netflix face are its lack of streaming content, it’s inability to advertise during content being displayed, and streaming the same content quicker and for free in some cases.

Another major weakness of Netflix is the fact that users can provide their membership info to other non-members

SWOT Continued...Opportunities- Expansion through partnerships online, services provided to

homes(cable, internet, gaming consoles, smart tvs, etc…), as well as international expansion, and the expansion of the content in which they provide

Other opportunities include the creation of original content which has benefited Netflix tremendously.

Threats- The major threat being able to access the same content from a different source, for less or even no cost. Also threats from competition like Hulu, HBO GO, and Amazon offer different content, rates, and services.

Licensing and partnerships with certain media producers limits content and allows other companies to control the market of certain media demanded from consumers.

Competitive Analysis

When first established BlockBuster was largest competitor

The three largest competitors to Netflix now are...

Hulu, HBO GO, and Amazon Prime

Traditional v.s. Online Businesshttp://www.youtube.com/watch?v=mgEPJ8DbIYIOriginally providing DVD’s through the mailEliminated late fees and not having to physically

acquire to content from a store was a competitive advantage over businesses like BlockBuster and Hollywood Video

Reached full potential when creating instant streaming now completely separating them from traditional business practices

Netflix has been extremely successful at using its online format to collect data on consumer behavior and feedback in order to enhance the individual experience of each viewer

Company Websitehttps://www.netflix.com/?locale=en-US

Categorization of genres-each contains 40 viewing options-popular on Netflix-dramas-recently added-comedy-children & family movies-new releases-documentaries-TV shows & more

Company WebsiteNavigation by search bar

titlemovieTV showactorsdirectorsgenres

Company Website

Privacy PolicyCollection & Use of InformationCookies & Internet AdvertisementDisclosure of Personal InformationSocial SharingChanges to PolicyTransfer of InformationInternational Users

Cannot 100% guarantee security

Cross-Cultural Differences

Started expanding outside the US in 2010Available in almost all of North & South AmericaMost recently available in the NetherlandsPlanning to expand into Europe in the second half

of 2014

Cross-Cultural Differences

Less variety in countries outside the USDifferences in licensing among countriesAccommodates for language differences

Conclusion... In conclusion Netflix Inc. has established itself as the largest

subscribed online media provider (40 million)This form of e-commerce has drawn many other companies in

past years and demand for instant streaming stronger than ever

Netflix has become the name brand in this industry in consumers minds when they think of streaming media from any platform

Must increase content and continue to innovate to stay leader in this industry

THANK YOU!! Questions?