E-Marketing Case Study #1 (Netflix) -- Question 2

2.    Did Netflix offer same values for consumers that Blockbuster did? How did this evolve over time?

    From the analysis of question 1, it’s evident that Netflix offered more values for customers than Blockbuster.  As a result, we focus on Netflix’s offering of values when addressing how it evolved in the following chart:

Netflix’s evolutions	Customers’ values	How to evolve
Founded in 1997. Offered home delivery of DVDs through the mail	1.    Home delivery service 2.    Build personal movies list, called “queue”. 3.    Enjoy value, convenience and selection.	1.    Develop cross promotional programs with the manufacturers and sellers of DVD players. 2.    Use USPS to deliver DVDs. 3.    Provide search engine. 4.    Pricing model shifting from traditional style to internet retailers as eBay & Amazon.
Provide no-late-fee subscription model in 1999.	Attract many high-volume customers.   Offer “all you can eat” model to provide an attractive alternative to the traditional per-day fee structure.	1.    Change to 4 movies at once and receive up to 4 new films each month. 2.    Change to offer unlimited rentals, subscribers keep 3 movies at a time and exchange as frequently as they like.
Offered its recommendation system to any users as a web portal in 2000.	Match the customer’s preference and get more attractive information about the movies.	1.    Survey the customers’ favorite movies list. 2.    Stimulate demand on older & less known movies. 3.    Large customer-generated system of rating, reviewing and recommending. 4.    Play a filter between the recommendation system and the subscribers. 5.    Negotiate with the major studios to  reduce their price on the title’s total no. of rentals.
Over 90% of subscribers receive DVDs within a single business day in 2007.	No delay time, which enable customers to meet their satisfaction instantly.	1.    Accept subscription not on the web site on 2002. 2.    Reach profitability for the first time in 2003. 3.    Established 44 distribution centers across the country in 2007.
2007, Online VOD alternatives	3 options for instant viewing needs and fees	1.    License arrangement with cable providers. 2.    Integrate online video feature into their current offerings. 3.    Build a stand-alone online video business.