About Netflix:

Netflix INC. is an American media company which offer’s top notch video content on demand and on subscription model. The main and important thing is that Netflix also owns their own original shows which is categorized as Netflix originals and 40% of them are produced inhouse. Netflix has over 208 Million subscribers all over the globe. Netflix is also a member of motion pictures. The company was incorporated in 1997 by Reed Hastings and Marc Randolph in scotts valley in California in USA.  

Netflix’s evolution:

Company started with the vision and initial focus on the business of DVD rental but as the time went in 2007 netflix entered in the business of videos on demand or popularly known industry of streaming media. The company started expanding their business in 2010 internationally and entered in 2013 they started and added new part of their business which is producing their own content. And in 2016 they expanded in 130 more countries and now they are operating in almost 190 countries all over the globe.

Small picture of business evolution:

Netflix’s Business model or earning model:

Netflix mainly work on subscription packages for getting the access of content and different quality of the content like SD or HD with different screening options.

Cost for Netflix:

Netflix has to pay some cost out of it which are mainly licensing cost, production cost, marketing cost, R&D cost ad technology development cost and other costs.

Target audience for Netflix:

They target 18 to 60 year old male and female’s all over the world as they have content in all main languages like English, French , Spanish, Korean, Hindi , etc.

Netflix India:

Netflix India was discover in Jan 2016. Where Netflix is serving the other international content along with some of the popular Hindi movies and inhouse produced hindi movies and series.  Some of the popular movies and series in hindi are ludo, Jamtara, sacred games, etc.

Plans for Netflix India:

Netflix India has some set of plans which are Mobile only (INR 199/ Month), Basic plan (INR 499/ Month), Standard Plan (INR 649/ Month), Premium Plan (INR 799/ Month).

Netflix India Subscriber count:

Netflix India has approx. 3 Million Indian subscribers and which is lower then most of its competitors like Disney +, Prime Video and Youtube, etc.

Netflix India Market Share and Other OTT Platforms Market Share:

Netflix’s Popular Campaign in India:

1. “One Story Away”
2. “get up”
3. “ You will work in this town again”
4. “Wanna Talk About It?”
5. “Netflix Stream Fest”

Analysis for Netflix in India:

SWOT analysis for Netflix India:

Strength:

• Netflix uses SVOD method which means Subscription video on demand.
• All the plans allow to access all the content unlike Disney +.
• They have very strong copy right policy and has strong relationship with existing suppliers.
• They try to promote the platform with all the unique options which makes the ads reaching to huge crowed.
• They have very successful go to market strategy.
• They are also having high profit margin.
• They also have their own production house so inhouse productions and original series makes it even more better and allows to save costs.
• Brand reputation is one more key strength for Netflix.
• They have most of the award-winning shows in their list.

Weakness:

• Due to company’s policies and content which are licensed have limited copyrights and revenues are shared due to which profit is less.
• Netflix is still legging behind with the sustainability initiatives which can also help for promotions.
• In India they have support shortage.
• Netflix’s model can easily copy with some of the tweaks.
• Constant improvement is required for the technology purpose which is difficult to role out.
• System is not flexible and mean while the cost of maintenance is high.
• Decision making is mostly controlled by head quarters so the ability of decision making for Indian market is poor.

Opportunity:

• Netflix India can try for more customer data base.
• More tie ups with other content providers and TV channels for live TV.
• Getting content in different Indian languages.
• Emerge in social media business and merchandise business via e commerce site.
• Fan collective Items sales.
• Adding ad-based services with low price package.
• Add more customization and make more content as per customer and the market.
• Partnership with Indian content makers and content providers.

Threat:

• Shortage of skillful labor’s.
• Threat of illegal circulation of the content.
• Different censorship rules and regulation.
• Increase in the competition with more content as per the Indian market.
• Account hacking case due to which customers tend to switch to other services.

Porter’s Five Forces:

Rivalry among existing players:

Rivalry among existing players is huge concern and it is high due to which India is a competitive market for OTT platform.

Bargaining power of suppliers:

Bargaining power of suppliers are high due to Netflix’s SVOD platform so they can extract higher prices.

Threat of substitute products and services:

Threat of substitutes are high and due to which Netflix has to do lot of R & D

Bargaining power of buyers:

Bargaining power of buyers are high and due to which the Netflix in Indian market had to get the lower rate mobiles only plans.

Threat of new entrants:

Threat of new entrants are high and due to which current players are ready to cut the profit margin to reduce such threat.

VIRO Analysis:

Resources	Value	Rare	Imitation	Organization	Competitive Advantage
Customer base loyalty	Yes, as customer suggest’s changes	Yes, the firm has able to build a special relationship with its customers	It is very difficult to imitate	Going by the data, there is still a lot of learning and upsides	Most Strong Competitive Advantage
Alignment of Activities with Corporate Strategy	Yes	No	Each of the firm has its own strategy	Yes, company has organizational skills to extract the maximum outcome	Still lots of potential to build on it
Local Presence	Yes, as it diversify the revenue	Yes	Can be imitated by competitors	Yes, it is one of the most diversified companies in its industry	Providing Strong Competitive Advantage
Intellectual Property Rights, Copyrights, and Trademarks	Yes, they are extremely valuable especially to thwart competition	Yes,  rights are rare and competition can’t copy	Risk of imitation is low but in given period of time it will be challanging	So far the firm has not utilized the full extent.	Providing Strong Competitive Advantage
Successful Implementation of Digital Strategy	Yes, without a strong digital strategy it is extremely difficult to compete	No, as most of the firms are investing into digitalizing operations	Can be imitated by competitors	One of the leading player in the industry	Digital strategy has become critical in the industry and one of the most competitive part
Brand Positioning in Comparison to the Competitors	Yes	No	Can be imitated by competitors but it will require big marketing budget	Yes, the firm has positioned its brands based on consumer behavior	Temporary Competitive Advantage

Netflix is Successful in India or Not? :

Simple answer for this is no Netflix is not successful in India. As the Market share for Netflix as per the resource of Omdia is only 7% and the other OTT platforms are doing better and better and the main issues are high rate of substation, threat of new entrant is high. If we see on price module the Netflix has a premium price and its high for Indian market and more over that Netflix lacks on Indian connective movies and series. India is a huge market but Netflix is not able to reach our or create connect with huge customer base.

 Recommendations:

• Netflix should try to give promotional discounts and work on referral bonus program.
• They should work on pricing module and reduce the price for increasing the volume of customers.
• They should get series and movies in regional languages.
• They should promote more Stream fests to connect with more customer and increase the data base.
• Netflix India should work on getting partnership with other live TV channels.
• Netflix should also try to get more partnership with Indian creators and provide more specific content to increase the subscribers.
• Netflix India should also work on reliability to increase the market share.

 

Written By Shail Vajani