Netflix, Sigapore Net Trade. Success Factors

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Singapore Trade Net

First, it should be emphasized that the project itself is rather successful; however, the market share could be larger if proper project management strategy was implemented. Considering the fact that the results have exceeded the expectations, the market results could be higher.

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From the perspectives of costs, schedules and scope goals, the project may be regarded as successful, though, considering the satisfaction level of the sponsors, it should be stated that the actual importance of the project implementation is linked with the improvement of the document transmission services, as well as the costs lowering. Moreover, considering the market share of the organization, the interest level of the sponsors is not regarded as the key parameter.

In general, the project reached its goals, and it should be emphasized that the key success factors are the proper structural penetration of the project. Hence, the project was licensed properly, and the actual values of this licensing process are explained from the perspective of providing the basis for smooth and effective activity, as licenses do not only permit some particular activity, but also emphasize the reliability of the company. As for the TradeNet activity, all the consumers had been satisfied for the penetration and extended activity period of the organization.

The risks of managing the project were associated with lowering the service costs which is featured with the extensive losses and expenses. Moreover, this is closely linked with the possibilities of taxation problems, as this type of business activity is regulated by the government. Another risk is the conceptualization of the services. This is based on the premise that courageous ideas need to be risk managed properly. This was performed by analyzing the possible consequences and risks associated with the trade activity. The measures involved establishment of the working groups responsible for each activity sphere.

In general, these measures are quite applicable, as the responsibility diversification is regarded as the key measure of risk management. Hence, the lessons learned are closely linked with the values and principles of proper responsibility allocation. As for the matters of activity regulation, it should be emphasized that the actual value of the lessons and regulation principles implemented within the organization is emphasized by the necessity to analyze and improve the activity constantly. The organization managed to exceed the stated goals, though the result could be better if the company cared of uniting with former competitors.

Netflix

The change of the company’s strategy is closely linked with marketing performance. Hence, the company invented the innovative strategy for hitting the target audience, and finding those who are able to pay the highest fee for the rental services. Hitting the busy parents, and offering them the constant reserve of movies or games is the perfect solution, as shopping for games or any other entertainment production often ends with disappointment of the younger audience, and irritation of their parents. Hence, the parents are liberated from purchasing movies in shops, while the company has an opportunity to get itself praised for the successful idea. (Albarran, Alan and Arrese, 255)

As for internet operations, this strategic solution was required for at least two aims: increasing the target audience of the company, and decreasing the order time for the existing audience. If a request is sent via mail, the customer had to wait the receiving of his/her letter by the company, and then for receiving the ordered production. Internet ordering helps to double shorten the waiting period, and simplifies payment accepting essentially. This is explained by the statement that people prefer getting services without leaving their homes, and internet operations are regarded as the perfect solution not only for consumers, but for companies as well.

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In comparison with Blockbuster company, Netflix is not focused on diversifying the ways of delivering the information, as it makes a precise accent on the matters of production quality. Blockbuster, in its turn, offers rental services online. While Netflix is aimed at providing hardcopies for rental, blockbuster is focused on providing an opportunity to download the content. Blockbuster CEO considered that customers will not benefit from mailing the offered production, while Netflix doubts that high quality services are possible with online rental principles applied. (Price, 682)

The case of the problems can not be related directly to the course, though the business models of media rental should be studied. On the one hand, the students of art and design department need to know the instances of media content development, and be able to assess various business models of media rental and selling. Additionally, the instances of competition in the case of Netflix vs. Blockbuster are regarded as the inevitable part of marketing performance, and, while Netflix is seriously worried on the matters of business development, and offering higher quality services, Blockbuster has reached bankruptcy due to unwillingness to diversify its services. (Hill, 169)

The relevance of this case depends on the perception angle, as while the case may be regarded from the perspective of services quality, similarly, it may be regarded from the perspective of marketing strategy performance.

Netflix Case Analysis

First, it should be stated that the company had to change its operational strategy, and the key reason of this change is closely associated with the necessity to get adapted to new business conditions. Availability of internet video databases and companies that allow their users to get videos directly, without leaving their homes, forced Netflix to change the principles of its business operation. In general, the proper assessment and argumentation of Netflix operation requires in depth study of the industry. SWOT analysis is the key step in analyzing company’s performance.

Positive Negative
Internal Strength
-Reliable services
-Innovative rental approach
-proper audience segmentation
-wide range of products available
-extended network
Weakness
-Weak advertising strategy
-unavailability of soft copies for download
-lack of payment flexibility
External Opportunity
-Faithful audience
-innovative and comfortable rental scheme
-independence from software systems used by customers
Threat
-decrease of video home rental popularity
-appearing of internet rental and download agencies.

Hence, the operational performance of the company is closely linked with the values of business environment. Considering the fact that the popularity of rental services gradually decreases, the change of business strategy, associated with providing an opportunity of unlimited rental, may be regarded as rather daring, as the company had to bear essential losses. Nevertheless, the perfect audience segmentation and targeting helped the company to recover in the circumstances of the growing internet rental agencies. The key problem of the rental services are described in Shin and Kaufman (6):

Movies are a taste-based product, for which many titles are consumed only once. As such, consumers must make a series of purchases without knowing for sure if they will like the product. Netflix’s website resonated with subscribers because they so frequently enjoyed the less well-known films recommended to them that they might not otherwise have seen. This software established a relationship with customers that was not matched by part-time employees at a retail video store, nor easily replaceable upon switching to a competitor’s service.

In the light of this fact, it should be emphasized that the actual importance of effective operational changes are associated with adapting towards the changing circumstances and tastes. In fact, video rental industry is subjected to essential changes, and these changes originate changes in business operation of rental agencies.

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Additionally, Netflix had to originate cooperation with the video recording agencies, as the traditional video rental scheme was no longer reliable for effective operation. Hence, the copyright agreements helped to reduce the rental prices. Additionally, it helped to overcome the problem of new releases, as in general, movies were not available in 6 months after premier. Any movie disappeared from shelves, and customers could forget of it, as Sarandos explains it (in Shin and Kaufman, 7). Hence, the company managed to resolve this problem, which increased customers’ loyalty. Nevertheless, the appeared solution is less effective in comparison with availability of video in Internet. However, high quality videos are not available for download, especially is Blue Ray videos are needed (which may be of 30 Gb size and larger). Hence, Netflix has performed everything possible for increasing the target audience.

The company is highly dependent on the art tendencies, as movies are quickly becoming popular and not-demanded again. Consequently, the choice and catalogues need to be renewed regularly. Netflix has resolved this problem by offering the most popular novelties that are shown in theaters. However, considering the particularities of target audience segmentation, the company also offers classics of world cinematography, including childish movies and cartoons. While parents have an opportunity to watch their favorite movies, kids watch cartoons, and adults do not have to tolerate scandals in movie stores, while everything may be selected in on-line catalogue. Actually, this is the key step of increasing customers’ loyalty, and the actual importance of providing such an opportunity helped to decrease the costs for printed catalogues. Additionally, this was important for decreasing the amount of rental points across the country. Consequently, customers have an opportunity to order everything the like without leaving their chairs.

Finally, it should be emphasized that Netflix is one of the few video rental companies that managed to survive in a market of internet available videos. In fact, this made them to rearrange their overall operative strategy, as the preferences of the audience is changing in accordance with the tendencies of art and cinematography in particular. Hence, the company has to adjust its operative strategy. As for the matters of video rental industry, and the increased availability of video in internet, the company had to offer the innovative context of the same product: video may be ordered online, however, the quality of this video, and the comfort of rental can not be compared with the services offered by other companies.

Works Cited

Albarran, Alan B., and Angel Arrese, eds. Time and Media Markets. Mahwah, NJ: Lawrence Erlbaum Associates, 2007.

Hill, Brian C. “Measuring Media Market Diversity: Concentration, Importance, and Pluralism.” Federal Communications Law Journal 58.1 (2006): 169

Price, Monroe E. “The Market for Loyalties: Electronic Media and the Global Competition for Allegiances.” Yale Law Journal 104.3 (2004): 667-705.

Shin, Willy; Kaufman Stephen. Netflix. Harvard Business School. 2009

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