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Introduction
Netflix, Inc. is a media company that was founded out in Los Gatos, California in 1997.
Netflix was the first of its kind when it came to streaming services. It was revolutionary in the
way that you would be able to able to stream any show at any time. Netflix has streamed popular
shows such as Grey’s Anatomy and Big Brother. Netflix created a new era with creating the
invention of streaming services with others such as Hulu and Paramount Plus to follow. (Ashburn
& Hosch, 2024)
Product and Firm History
Netflix, founded in 1997, by Reed Hastings and Marc Randolph, was created to create a
system of movie rentals over the internet. Fast forward to the year, 1999, Netflix created a
subscription service which entailed DVD rentals for a subscription fee. As Netflix began to grow,
it became public to everyone in 2002. Netflix had the ability to stream content media at home
and be able to watch any show you missed and watch it back any time subscribers wanted to. As
of 2009, Netflix partnered with many companies to get its programming streamed on smart TV’s
and gaming devices. By 2010, Netflix moved to mobile devices as well creating an all-new way
to take streaming services on the go. (Ashburn & Hosch, 2024)
Current or Global Marketing Plans
Netflix is a great example of successful international expansion. As of 2017, Netflix was
streaming in over 190 countries. As of today, Netflix has over 220 million subscribers. Its first
international expansion went out to Canada. In Netflix’s second phase, it expanded to over 50
countries; looking at the lessons, the founder could learn from the first phase of expansion. Since
Netflix was growing, it expanded into investments in order to build its expansion into other
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global markets. During the third phase, it began to look at how they could stream their services
in many different languages in order to break into different markets across the globe. Netflix
began developing different marketing strategies so the company could also improve the mobile
experiences such as including authentication, check ins and user interface. (2022)
Mission and Values
Netflix’s mission is “to entertain the world.”. Netflix’s mission statement is a two-fold as
Netflix focuses on world-class entertainment and investing in users to give them world class
entertainment through TV shows, documentaries, and movies. The second is for global
dominance. Netflix competes to be the most streamed service in the world. As of right now,
Netflix has over 230 million subscribers.
Netflix values are foundational in the fact that their core values stand by judgement,
communication, curiosity, courage, passion, selflessness, innovation, inclusion, integrity, and
impact. Netflix’s culture stands for “people over process”. This is meant for all employees to feel
included and create and positive and welcoming work balance to ensure team building. Their
values are built upon these principles people empowerment, transparency, friendship, to hire the
best, and to avoid rules. Netflix has gone against workplace norms in order to set them apart
from other streaming networks (Abbott, 2024).
Competitive Strategy
Netflix runs by the competitive strategy of cost leadership. Cost leadership is what
ensures a company has a competitive advantage with keeping costs down in order to compete
with other companies. This entails that keeping the costs down will attract more customers as
compared to looking at its competitors. Looking at all Netflix offers, this creates attraction as
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people see all the benefits such as all the shows and movies that Netflix presents, it’s almost a
steal when looking at the costs.
Netflix’s second competitive advantage is the fact that Netflix uses differentiation. This is
to make the company stand out from its competitors. The companies that Netflix uses its
competitive advantage against are companies such as NBC, Disney+, Hulu, YouTube, Amazon,
and more. When looking at Netflix’s Five Forces of Analysis, we see that they look at competitive
rivalry, buyer power, supplier power, substitution threat, and new entry threat. This particular
Five Forces of Analysis looks at the significance of competition and strategic positioning.
(Williams, 2023)
SWOT Analysis
Strengths
Netflix’s strengths are it’s exponential strengths by becoming an influential brand in the
entire world by becoming one of the most streamed streaming services around the world. Netflix
is also notable for their brand reputation to become a household name above their competitors.
Netflix is one of the most known streaming services across the globe ranking with a brand value
of $15.0 million. Their third strength is their global customer base with over 167 million
subscribers across 190 countries. Another one of its strengths is originality by producing original
shows to cater to many different audiences. Netflix also is strong in its adaptability. Over the
years, technology has evolved since its creation and so Netflix has had to adapt and evolve to
be able to grow and compete with other companies. Their customer-centric service is also huge
among its strengths as they always have their customers opinions in the forefront of what they
are thinking when they are evolving. (Parker, 2024)
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Weaknesses
When looking at Netflix’s weaknesses, we see that, Netflix has limited copyrights. They
don’t own all the rights to the shows that they have. This creates the problem where shows end
up on other streaming sites which creates competition. The company is also in debt as it keeps
adding to its debt, so they are able to diversify themselves to other countries to try to stay
ahead of its competitors. Netflix also does not use green energy, and this is a major weakness
in the world we’re in today as many of its competitors like YouTube, Google, and Amazon have
all switch to green energy. Netflix has increased its prices since its beginning model and
creation which has caused them to lose customers as the prices of every other product in the
world has gone up. This leads the company into growing operational costs. Adding more
content gives them an edge but also comes with a price with the increase.
Opportunities
Netflix has many opportunities which includes being a low-cost streaming option which
makes it more competitive as it becomes cheaper than its competition such as Disney+, Apple
TV, Hulu, Peacock and more. With Netflix, they have an ad-based model where advertisers can
promote their products on their streaming service in order to boost revenue. They also have a
Niche-marketing model they use producing region specific commercials in different areas of the
world in order to cater to every audience.
Threats
Netflix now has many competitors across the globe that are all competing for viewers
trying to present themselves as the best streaming service in order to increase revenue.
Services such as Disney+, HBO, Amazon, Hulu, and YouTube all have one common goal and
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that’s to be the top streaming service in order to create the most revenue. Another weakness
that Netflix has is that strict government regulations in certain countries can create threats for
them as there is only so much, they can do in certain countries due to their regulations. Pricy as
well is a huge risk as many people try to take certain shows and movies presenting them as free
which takes away Netflix profits. Netflix also deals with government pressure as it strains
infrastructure and resources. (Parker, 2024)
Conclusion
In conclusion, Netflix has made a major impact on streaming services because of all of
the benefits they offer. Netflix now in 2024 is a household name that everyone knows about
today. While Netflix has its strengths, it also has weaknesses with its competition. Netflix is
believed to be expanding and seems to be adapting to be able to be the top streaming service
in the whole world.
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References
A. (2022, June 20). Netflix’s international expansion strategy. Synergos.
https://synergos.biz/netflixs-international-expansion-strategy/
Ashburn, N., & Hosch, W. L. (2024, March 29). Netflix | History, Services, Awards, & Facts.
Encyclopedia Britannica. https://www.britannica.com/topic/Netflix-Inc
Parker, B. (2024, March 18).>Netflix SWOT 2024 | SWOT Analysis of Netflix. Business Strategy Hub.
https://bstrategyhub.com/swot-analysis-of-netflix-2019-netflix-swot-analysis/
Williams, A. (2023, December 5). Netflix’s Competitive Strategy & Growth Strategies.
Panmore Institute. https://panmore.com/netflix-competitive-strategy-growth-strategies-case-
study
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