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In this report, various strategic analysis tools like SWOT analysis and PORTER’ 5 force analysis have been applied on the business model followed by Netflix Inc. The results of the analysis methods reveal the various strengths, opportunities, weaknesses and the threats are being experienced by the organization. The present condition of the online movie industry and the competition that the organization faces from its rivals have also been demonstrated in this report.
Strategic management can be considered as a branch of management studies that is associated with the process of designing and implementing the vital strategies and policies incorporated by the higher management of an organization. Such decisions are taken by the higher management based on the assessment of the external or the internal environments of the organization, along with the consideration of the various resources available to the organization.
Using the policies of strategic management, an overall analysis of the business module of any organization can be achieved, which includes the objectives of the organization, the plans and policies incorporated by the organization, the processes used to allocate the resources of the organization and so on and so forth.
Netflix, Inc. is an organization that provides movie or media through the internet on the demand of the suppliers. It is a USA based company and provides services to all their subscribers who are located in North America, South America, New Zealand, Australia, and some countries of Europe, like that of Denmark, Germany, France, , Norway, The Netherlands, Sweden, Austria, Finland, Belgium, Switzerland, Luxembourg, United Kingdom and Ireland. The organization also provides DVDs of movies at flat rates throughout the United States of America, where they send the Blue-ray copies and DVDs of the movies through Permit Reply Mail. The company was established in 1997 and has its headquarters at Los Gatos in California. By 1999, Netflix had started their services that were entirely based on the subscriptions by customers. By 2009, Netflix had as many as 10 million subscribers, to whom the company could provide the copies of about 100,000 movies (Birkinshaw, 2004).
The strategic analysis of Netflix Inc has been done in the following section, using a SWOT analysis and PORTER’s analysis procedure (Brown, 2006).
SWOT analysis methodology is used to analyse the strength and weaknesses of the strategies that have been incorporated by the organization and the opportunity and/ or threats that the organization currently faces.
Using the Porter’s analysis method, a clear insight of the competitive environment that exists in the online movie industry can be developed. The diagram showing the results of Porters analysis method on the business model of Netflix Inc has been provided in this section of the report (Schoenmakers and Duysters, 2006).
Fig: Porter’s analysis method on Netflix. Inc
In this paper, a strategic analysis of the business module followed by Netflix Inc has been conducted, based on a case study on the organization that had been provided. SWOT analysis and Porter’s 5 Forces analysis are two commonly used analysis tools that are used for the purpose of strategic analysis. These two tools have been applied to the business model of Netflix. Inc and the results of this analysis have been provided in this report.
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