Environmental Scan Assignment Sample

Internal Analysis - Distinctive Competencies of Clients

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Many internal variables, including its unique competencies, contribute to Netflix's success in the streaming market. The company's customer-centric attitude, strong brand image, and data-driven approach to content creation are its primary qualities that have allowed Netflix to maintain its position as the market leader.

Netflix's data-driven approach to content production and creation is one of its key differentiators. The ability of the business to deliver viewers with the content they want to see is a key factor in its success (Bobmanuel, 2022). In order to accomplish this, Netflix use data analytics to recognise consumer trends and preferences, which help it, make decisions about the acquisition and creation of content. For instance, based on users' viewing preferences, the corporation employs algorithms to suggest episodes and movies to them. Additionally, Netflix has made significant investments in producing original content that appeals to its audience, including the popular programmes "Stranger Things" and "The Crown". Netflix has built a devoted fan base and kept strong customer retention rates by using statistics to guide programming decisions.

As per Kumar, Gupta and Dixit, (2020) the excellent brand image of Netflix is another unique competency. By providing high-quality streaming material, the company has become a market leader in the field. This can be seen in the business's award-winning original content, which has attracted a passionate fan base and favourable reviews from critics. Netflix's marketing initiatives, which have come to represent the company's distinctive and excellent services, are also consistent with its brand image. Due to this, the business has been able to set itself apart from its rivals and hold onto its position as the market leader.

Finally, another significant aspect of Netflix is its customer-centric approach. A flawless user experience and adaptable subscription options are priorities for the organisation. The company, for instance, lets customers create several profiles and provides tailored recommendations and content suggestions depending on their watching preferences as per Phadermrod, Crowder and Wills, (2019). Additionally, there are other membership options available from Netflix, including a free trial, basic, standard and premium plans. High customer satisfaction ratings and brand loyalty are both results of the company's customer-cantered strategy.

Netflix's internal investigation identifies a number of unique strengths that have aided in the company's success in the streaming sector. The company's customer-centric attitude, strong brand image, and data-driven approach to content creation are its primary qualities that have allowed Netflix to maintain its position as the market leader (Bernat, 2018). These skills have enabled the business to provide distinctive and high-quality offerings that set it apart from its rivals, sustain a devoted fan following, and continue to expand in the quickly changing streaming sector.

External Analysis - Key success factors for key market segments

An external review of Netflix identifies a number of crucial success criteria for the business in its core markets, which include the US, Europe, and Asia. A solid digital infrastructure, a wide variety of content and strategic partnerships and collaborations are among these key drivers.

First of all, Netflix's ability to succeed in all of its market categories depends on having a solid digital infrastructure. The ability of the business to provide clients with top-notch streaming material will determine how successful it is in the long run. This necessitates a solid and trustworthy digital infrastructure that can manage large amounts of data while delivering a smooth user experience (Daidj and Egert, 2018). Netflix has made significant investments in developing its own content delivery network in the US, allowing it to provide its users with content more quickly and effectively. The business has teamed up with regional internet service providers in Europe and Asia to make sure that its content is accessible to users with various levels of internet connectivity.

Second, Netflix's ability to successfully compete in all of its market sectors is largely due to its wide content catalogue. A vast library of licenced and original content created by the company has attracted a wide variety of viewers. According to Groshek and Krongard, (2016) The company is able to meet the distinctive tastes and preferences of viewers in various regions thanks to its varied content library. For instance, Netflix provides a wide variety of content in the United States, including well-known TV episodes and films, whereas in Asia, the firm has made an investment in producing content that matches the regional culture and language.

Lastly, strategic alliances and collaborations are crucial to Netflix's success across all of its business categories. To increase its content library and enhance its products, the company has collaborated with content producers, production companies, and other industry participants. For instance, in order to obtain licencing agreements for well-liked films and TV episodes, Netflix worked with big production companies including Disney, Sony, and Universal. In order to produce original material that resonates with local consumers, the company has partnered with regional content producers in several areas.

An outside review of Netflix identifies a number of crucial success criteria for the business in its core market niches (Mier and Kohli, 2021). A solid digital infrastructure, a wide variety of content and strategic partnerships and collaborations are among these key drivers. Utilising these success elements has allowed Netflix to increase the range of content it offers and hold onto its position as the market leader in the streaming sector.

Integration - Analysis of Netflix's current and future competitiveness in key market segments

The firm is in a strong position to continue to dominate the streaming market, according to a study of Netflix's current and potential competitiveness in its primary markets of the US, Europe, and Asia.

Netflix's competitive advantage in the US, its largest market, stems from its vast content collection and data-driven approach to content creation and curation. The business has also made large investments in creating its own content delivery network, allowing it to serve clients with content more quickly and effectively as per Chiu, Chu and Kuo, (2019). Future success for Netflix in the US will depend on its capacity to continue producing interesting original content and uphold high user retention rates.

According to Souza and Romero, (2021) Local streaming providers and conventional TV networks compete with Netflix in Europe. However, the business has made great strides in the area of developing its brand image and growing its content library. Additionally, in order to provide original material that caters to regional audiences, Netflix worked with regional production companies and content producers. To maintain its competitiveness in Europe, the company will need to make further investments in producing content tailored to the region and improving the user experience.

In Asia, Netflix has advanced significantly in recent years, building relationships with regional ISPs and growing its library of available material. Piracy, which is still a major issue in the area, and local streaming services present the corporation with fierce competition. In order to maintain its position as a market leader in Asia, Netflix will have to keep making investments in regional-specific content and forge alliances with regional production companies.

Looking ahead, Netflix's ability to adjust to shifting consumer preferences and industry trends will determine its competitiveness in its core market sectors. To provide customers with high-quality streaming material, the business will need to keep innovating and investing in advancing its technological infrastructure as cited by Jarrahi, Kenyon, Brown, Donahue and Wicher, (2022). To keep up its dominance in the streaming market, Netflix will also need to keep producing attractive original material and obtaining licencing agreements for well-known films and TV episodes.

Netflix's ability to capitalise on its unique skills and adjust to shifting market trends will determine its competitiveness in its main market sectors both now and in the future. The business is in a good position to continue to lead the streaming market by making additional investments in partnerships, content creation, and technology.

Situation statement

As it continues to compete in the fiercely cutthroat streaming market, Netflix confronts a number of strategic challenges. The necessity to maintain a competitive advantage in content acquisition and creation, the rising cost of content licencing, and the difficulty of extending its global reach while negotiating various cultural and regulatory environments are some of these problems (Tyagi, 2018).

The need for Netflix to keep its competitive edge in content generation and acquisition is one of the company's core strategic challenges. The company's success has been based on its capacity to create unique material of a high calibre that connects with its audience. The cost of creating original content is also increasing as the streaming market grows more saturated and more competitive for content. Netflix must continue to make investments in content creation and acquisition while balancing the need to cut expenses if it wants to stay competitive.

The rising expense of content licencing is another strategic challenge Netflix faces. Viewers can choose from a wide variety of selections because to the company's extensive collection of licenced content. However, as more traditional media businesses enter the streaming industry and demand larger royalties, the cost of licencing this content is rising. Netflix must strike advantageous licencing agreements in order to retain its library of licenced content, as well as make investments in original content that is less dependent on licencing.

Another major challenge for Netflix is extending its global presence while managing various cultural and governmental situations (Rayna and Striukova, 2016). The company has seen substantial expansion in international areas, but it still needs to deal with issues including linguistic hurdles, cultural differences, and governmental restrictions. In order to maintain its global expansion, Netflix must create regionally relevant content that appeals to local consumers, while simultaneously negotiating challenging legislative frameworks and resolving concerns about content control.

Several important strategic problems, such as how Netflix can preserve its competitive edge in content creation and acquisition while reducing expenses, must be addressed in order to address these strategic issues. How can the business secure advantageous licencing agreements to keep its library of licenced content? And how can Netflix grow its global reach while navigating various cultural and legal contexts?

The initial response to these queries is that Netflix has to keep funding content acquisition and creation while simultaneously looking at novel cost-cutting measures like content library optimisation and enhancing data analytics skills (Kretschmer and Khashabi, 2020).. The business must also adopt a more sophisticated strategy for licencing agreements, making use of its data analytics capabilities to pinpoint the most valuable material and strike advantageous partnerships. Finally, in order to increase its global presence, Netflix must create localised content, cultivate partnerships with regional production businesses and talent, and successfully navigate complex legal frameworks with the help of regional partners and business groups.

References

• Bernat, J. (2018). Netflix and iTunes case study research on blue ocean strategy.
• Bobmanuel, A. A. (2022). THE STRATEGIC ANALYSIS OF NETFLIX, INC.
• Daidj, N., &Egert, C. (2018).Towards new coopetition-based business models?The case of Netflix on the French market. Journal of Research in Marketing and Entrepreneurship, 20(1), 99-120.
• Groshek, J., &Krongard, S. (2016). Netflix and engage? Implications for streaming television on political participation during the 2016 US presidential campaign. Social Sciences, 5(4), 65.
• Jarrahi, M. H., Kenyon, S., Brown, A., Donahue, C., &Wicher, C. (2022). Artificial intelligence: A strategy to harness its power through organizational learning. Journal of Business Strategy.
• Kretschmer, T., &Khashabi, P. (2020). Digital transformation and organization design: An integrated approach. California Management Review, 62(4), 86-104.
• Kumar, J., Gupta, A., & Dixit, S. (2020). Netflix: SVoD entertainment of next gen. Emerald Emerging Markets Case Studies, 10(3), 1-36.
• Mier, J., &Kohli, A. K. (2021). Netflix: reinvention across multiple time periods, reflections and directions for future research. AMS Review, 11, 194-205.
• Rayna, T., &Striukova, L. (2016). 360° Business Model Innovation: Toward an Integrated View of Business Model Innovation: An integrated, value-based view of a business model can provide insight into potential areas for business model innovation. Research-Technology Management, 59(3), 21-28.
• Souza, I., & Romero, F. (2021, September). Strategic Innovation Management at Netflix: A Case Study. In European Conference on Innovation and Entrepreneurship (pp. 955-R28). Academic Conferences International Limited.
• Tyagi, K. (2018). Implications of AT&T/Time Warner decision for Vertical Integration and Media Business Models in the age of Digitization. SSRN Electronic Journal, 1-7.
• Phadermrod, B., Crowder, R. M., & Wills, G. B. (2019). Importance-performance analysis based SWOT analysis. International journal of information management, 44, 194-203.
• Chiu, M. C., Chu, C. Y., &Kuo, T. C. (2019). Product service system transition method: building firm's core competence of enterprise. International Journal of Production Research, 57(20), 6452-6472.