Table of Contents
Company Overview 4
Issues 5
Analysis
External Analysis
Dominant Economic Feature 8
Competitive Forces – Five Forces Model 10
Driving Forces 12
Key Success Factors 14
Competitor Analysis 15
Industry Attractiveness 21
Internal (Company) Analysis Company Strategies 21 SWOT Analysis 23 Value Chain Analysis 29 Competitive Strength Assessment 30 Strategic Issues and Obstacles 31
Alternative Courses of Action for Success 31
Recommendations 31
Implementation 32
Works Cited 36
Appendices
Corporate Officers A
Online Movie Industry Market Share B
Renting Process Flow
Because of this Netflix will begin a frontal attack as of 2005 with Video on Demand (www.biz-architect.com/netflix_vs_vod.htm).
· New Entrants are becoming a threat to the existing members of the industry. More companies are deciding that they can take action in online renting. After Netflix pioneered the online rental service. Since then other major companies like Blockbuster began offering a lower monthly rate in addition to in-store renting. Netflix will not be able compete with in-store renting for the fact that they do not have brick and mortar establishments. With the new entrants in the industry the price of renting movies will become better for the consumers. In order to attract the biggest customer base the companies will need to battle over the best offer. As the competition occurs a few things can happen. First, the price of the membership will decline. Second, more movies will be offered.
· Netflix must also consider globalization as a potential area to gain market share. Currently Netflix is serving members throughout the United States and in the United Kingdom. There is already competition globally outside these two countries. Many of the companies in this industry already have locations around the world. For example, Blockbuster has sites in 25 countries, which are 2600 stores outside the United States alone (blockbuster.com). This would mean that they would have to set a distribution centers in a foreign country and