The Coffee Bean & Tea Leaf(CBTL), Business strategy case study
David Pearl: Analysis Netflix
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2. NETFLIX !
Let me show you some of my “content”…….a trip down memory
lane !
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10. NETFLIX VALUE PROPOSITION
•CONVENIENCE / USABILITY: 24-7 ACCESS TO CONTENT/RICH CONTENT + DVD
OFFERINGS
•OPTIONS/PRICE: A WIDE RANGE OF PLANS TO FIT ALL BUDGETS AND NEEDS
•VALUE CHAIN: DELIVERY OF CONTENT FROM MANY SOURCES
11. NETFLIX VALUE PROPOSITION
•ORIGINAL PROGRAMMING: TV, MOVIES, DOCUMENTARIES.
•CUSTOMIZATION: BUILT IN INTELLIGENCE THAT DIRECTS YOU TO OFFERINGS SIMILAR
TO PAST VIEWINGS
•FREEDOM: NO COMMITMENT MEMBERSHIP FEES.
12. IMPLEMENTATION ISSUES
•2010: ATTEMPTS TO IMPROVE THE COMPANY'S RECOMMENDATION ALGORITHM
•2011: FAILED: SEPARATE DVD RENTALS INTO “QWIKSTER”
•2011: LATIN AMERICA: LOSSES DUE TO OPERATING COSTS
•2011: TWO TIERED PRICING: TWO PLANS, PRICE HIKES. LOSS OF CUSTOMER FAITH
13. SOME OF THE CHALLENGES NETFLIX FACED
AND HOW THEY WERE OVERCOME
•LAUNCHED STREAMING OPTION TO AUGMENT DVD RENTALS
•ELIMINATED AND THEN REINSTATED SINGLE SUBSCRIPTION PLAN
•SPUN OFF SEPARATE COMPANY FOR DVD THEN ELIMINATED
14. SOME OF THE CHALLENGES NETFLIX FACED
AND HOW THEY WERE OVERCOME
•LOST INVESTOR CONFIDENCE THEN RESTORED IT 2011-2012
•NEW CONTENT: STARTED CREATING OWN CONTENT AS OPPOSED TO LIC—NOW
INDUSTRY STANDARD; REV DRIVER; COST SAVER
•IMPROVED SELECTION AND RECO ALGORITHM
15. THINGS NETFLIX DID RIGHT TO DELIVER ON
ITS VALUE PROPOSITION
•PRICES: KEPT LOW
•ORIGINAL PROGRAMMING: HOUSE OF CARDS, TV, FILM, DOCS
•ACCESS: 24/7 VIA STREAMING OR DVD’S
16. THINGS NETFLIX DID RIGHT TO DELIVER ON
ITS VALUE PROPOSITION
•OFFERINGS: INCREASED NUMBER OF OFFERINGS
•ALGORITHM: INCREASED INTELLIGENCE OF SITE TO PROVIDE FUTURE VIEWING CHOICES
•VARIETY OF AFFORDABLE PLANS TO FIT ALL LIFESTYLES AND BUDGETS
17. THAT’S ALL FOLKS ! THANKS FOR COMING !
AND DON’T FORGET THE POPCORN !
THANKS FOR COMING ! AND DON’T FORGET
THE POPCORN !
