1. Establishing Strategic Direction: Ansoff Matrix - Netflix
Existing products
New products
Market penetration strategy
Product development strategy
Existing markets
U.S.A.- more purchasing and usage from existing customers across all product categories
Develop new products such as video and computer games.
(20% increase in sales in 2008)
New markets
Market development strategy
Diversification strategy
Investigate optimum markets in North America i.e. Canada, and adjacent countries such as Mexico, moving on to Argentina, Chile and Brazil and later –U.K. Australasia, and India (Bollywood factor).

2. Generates demand for older, cheap films
BCG Matrix - Netflix
Generates demand for older, cheap films
Dogs
software to enable commercials to be avoided
Streaming
Subscribers
Movie downloads
Question Marks
Stars
Market share (relative to largest competitor)
High Low
High
Market growth
Low
Cash Cows

3. Firm’s Infrastructure Firm’s Infrastructure Technology Development
Understanding how Netflix adds value to its business and its place within the value system
Support Activities
Firm’s Infrastructure
Open and transparent culture. Interesting adult attitude to staff. Progressive organisation.
Firm’s Infrastructure
Open and transparent culture. Interesting adult attitude to staff.
HR Management
Innovative approach to staff management. Black and white to some extent. Slackers are fired and great staff are rewarded by having open ended annual leave arrangements.
Margin
Technology Development
Large scale digital distribution via streaming and downloading service
Procurement
Strong buying power. Sources the latest DVD’s , blu ray discs from producers /manufacturers.
Inbound
Logistics
Assume effective systems in place as operations, inbound logistics/service all run smoothly.
Operations
Online distribution is working well
Outbound Logistics
Supply chain functioning well. No problems encountered with distriibution /supply of products to customers
Marketing
& Sales
Brand mgt – need to measure awareness and position the products more memorably in a crowded marketplace
Service
Prides itself on good customer service and innovative staff policy
Margin
Primary Activities

4. Competitor Analysis: Netflix Porter’s Five Forces Map
Threat of new entrants - High
Crowded marketplace. Barriers to entry are low. Key competitors are Apple, Amazon, Google, Walmart, Hulu, and Redbox,
Buyer power – High
Consumers today have so much choice in buying dvd’s blu ray discs, video on demand etc. so prices have to be competitive
Supplier power-
Medium
Suppliers will always try to drive up prices but equally they need to sell their products and are under pressure from recessionary factors
Industry rivalry - Intense Competition in all product commodities is increasing. Supermarkets have immense buying power. Category killers such as Walmart can compete effectively on price
Threat of substitutes – Medium
Technology grows at a fast pace. DVD’s are expected to be around for a while but the internet will become the principal vehicle for distributing films in years to come.

5. Matching Assets and Competencies – Netflix’s sustainable competitive advantage in U.S.Market
Netflix’s Assets/Competencies
Sells DVD’s and Blu ray discs that consumers need
Strong brand recognition in U.S.A
Quality product
Wide product range
Fairly strong customer service – high levels of customer satisfaction.
Services are tailored for individuals-onscreen welcome, recommendations
Offers high speed streaming of movies and TV programmes via the internet
Internet service includes movie recommendation algorithms
Customer Requirements
Consumers always need and enjoy home entertainment
Brand recognition/brand long- term stability
Quality over competition
Large selection to choose from
Attentive customer service
Personalisation
Good distribution network – mail, video kiosks, vending machines, downloading, streaming, etc.
Advice on which films to watch
Best Fit
Match

6. International Decision making model Business Portfolio Model – Harrell & Kiefer. Selection of Markets and Product/Market development
Netflix Compatibility/capability
Country attractiveness/priority
High
Medium
Low
Primary
Canada
Secondary
Mexico
Argentina
Colombia
Brazil
U.K.
Australasia
Tertiary
India

7. Product analysis - Netflix
High popularity
Low popularity
High Price Low Price
PREMIUM STRATEGY
GOOD VALUE STRATEGY
Streaming and discs for rent, both Blu-ray and DVDs
Older films
OVER CHARGING STRATEGY
ECONOMY STRATEGY
DVD Boxed sets

8. Product Perception Grid - Netflix
Quality
High
1 =
2 = 1 3 3= 2
4 =
5 =
Price
High
Low 4 6= 5 7= 6 7
Low