Netflix Strategy And Challenges: Expanding Globally And Competing With Rivals

Challenges Faced by Netflix: Slower Growth and Competition

Netflix is known across the world as an American entertainment company. The company was founded by Reed Hastings and Marc Randolph on August 29, 1997. The brand is specialized in providing streaming media and video-on-demand online and DVD by mail. The brand is continued to grow in the current market scenario; In January 2016, Netflix services operated in over 190 countries.  The report is regarding the strategy of the company and how is it possible for the brand to match up with the consumer expectations. . In such a competitive market, this has become necessary to respond adequately in order to deal with the situation. There is a necessity to expand strategically in order to gain long term sustainable results (Cammaerts and Meng, 2011).

After a positive and solid reaction from people in the previous 5 years Netflix is confronting more difficulties.  The company has received only 2.5 million net viewer option versus the 3.28 million, included a year prior. The offer dropped by 14%, while the S&P 500 was up around 6%. There are three difficulties that Netflix is confronting and how management is attempting to defeat them (Chun, Kim, Morck and Yeung, 2008).

as of now, There are 47 million subscribers in the U.S. For the reason, Americans considers Netflix like YouTube or some other video benefit (Cowen, 2009). They have just 134 million family units and only 88 million broadband supporters. The brand is confronting issues in the nation of origin itself. Netflix still can develop to 60 million to 90 million U.S. endorsers, as indicated by its long haul see. It’s appearing as though it may wind up close to the lower-end of that range than the top of the line. The organization hopes to include only 500,000 net new clients in the U.S. for the second quarter contrasted with 900,000 a year ago (De Figueiredo and Kyle, 2006).

With a specific end goal to battle the log jam, Netflix has expanded its estimating. Amid the quarter, most long-lasting subscribers saw a month to month increment $2, to $9.99. In addition the development is backing off. The organization has seen a development in a moment quarter with a 18% expansion in income from residential streamers regardless of only 12% expansion in all out subscribers (Jewel, 2006).

 The company has announced an expansion to China incoming years. Before this announcement they were operating in about 50 countries, and had just over 18 million international subscribers. In order to grow outside the current market the company has to add new potential subscribers. This is not an easy task for a company (Hartshorn, Maher, Crooks, Stahl and Bond, 2005).

Strategies to Overcome Challenges: Global Expansion and Increased Pricing

 Netflix is growing in Latin America; the U.K., and Scandinavia. The smaller regional competitors have started affecting the company. This has comparatively reduced the company’s competition in the market. It is necessary enough for the market to develop international growth in order to grow effectiveness (Hart, 2005).

Netflix is significantly increasing its global rights for blockbuster content like Gotham before the first episode was aired.  They have come up with the global rights that have created a significant shift from its regional license of the House of Cards.  There is a fierce competition from the other market players. There are lot other companies as well that are dealing in the similar market. Hence, this might create an issue with the Netflix in handling the market. This has created a potential damage to the brand in holding up the adequate level of brand distinctive objective (Santoso, Horne and Wicker, 2013).

In order to create effectiveness in the current market it is necessary for creating an advanced technology in order to improve customer experience. Netflix has completed its massive migration on Amazon Cloud (Jenner, 2016).  They have effective customers’ content utilization habits on the basis of content they are offering. Content licensing agreements with TV networks, filmmakers, and other content is causing a great issue to the company in delivering objective. Netflix  has made an investment of $200 million to access Disney films and TV programming for one year.  In order to create a conquest in the market, there are major challenges that have created issue for the brand in delivering effective results (Adhikari, Guo, Hao, Varvello, Hilt, Steiner and Zhang, 2012).

Netflix’s competitors like Hulu, HBO Go and Amazon are working on the similar strategy. These strategies are therefore creating a major concern for the brand in gaining effective space. Major brands like Google and Apple already have a strong base which is causing stringent competition to the brand.

Moreover, Youtube, music is into the leading category followed by gaming, comedy and film & animation. Smosh, Nigahiga and the Ellen Show are known as the top shows in the USA on Youtube. A Majority section of people prefer watching shows on Youtube.  This is however creating an issue in dealing with the issues that has a capacity to be managed. It is necessary for generating better space in order to gain effective market space. In order to generate better results, it is important to gain effective results. There is saturation in the number of people using Netflix. This is however affecting the popularity of brand on a large scale. Netflix has started investing overseas. The company is expanding business in the Asian market.  One of the biggest challenges for the brand is to expand into the Indian market.

Netflix: Growing in Latin America, U.K., Scandinavia and China

Netflix’s revenue has grown continuously ever since 2013.  They have a strategy to add New Content. This strategy has helped them to acquire considerable market. In such a short tenure they are able to gain market effectiveness. This is important enough in gaining a competitive market. In 2016, Netflix decided to let go its deal with Epix. The brand is regularly investing in Real Estate (as of now leasing) to build its own studios. Netflix’s content consisted of movies and TV series. This is important enough for dealing in current and strategic market in order to deliver effectiveness. It is important enough for gaining consequent results and appealing to the other market. This will however help in gaining strategic growth and availing better results. It is necessary for availing strategic growth and developing better options in order to attain considerable results (Porter, 2008).  This is necessary from the point of view of developing strategic results. It is important enough for gaining concrete outcome and arranging them in the best possible way.  Netflix has to expand its business strategy in an effective way so as to maintain sustainable brand image. It is possible for a brand to generate capacity in the international market by collaborating with the local channels (Gallaugher, 2011). This strategy will however will allow in gaining sustainable brand position. In coming years, there is a possible increase in the competition. This will affect the brand in a negative manner. In such a competitive market, this has become necessary to respond adequately in order to deal with the situation. There is a necessity to expand strategically in order to gain long term sustainable results. This will surely help in generating positive outcome (Shuen, 2008).  It is possible that the brand will however help in generating adequate results and arranging positive capacity on a long run. It is important enough for gaining effectiveness and the brand has adequate potential to get results. This is important for a brand to attain capacity with the current competition. In a short tenure there are certain other service provider like Amazon Prime, Online web streamer etc. This has caused a potential damage to the brand (Nagle, Hogan and Zale, 2016).   It has therefore created a gap in strategic implementation of the goals. It is necessary to be important enough for developing a progressive brand image in order to attain effectiveness. Competition in the market has caused an issue in dealing with the consequences. This is important enough to seek effectiveness that will surely help in delivering regular growth. It is necessary for developing better goals that will certainly in order to generate consistent results.  In order to procure organizational results, it is important to implement effective and precise results. It is necessary for generating better functions in order to generate long-term results. This will certainly help in managing effective results that have potential to generate competition (Bharadwaj, El Sawy, Pavlou and Venkatraman, 2013). In such a scenario, it is evident to create results that would certainly help in managing the functions in order to generate better results. This has created difficulty in managing the consequences. It is necessary for developing results that has helped in generating effective results.  In order to defeat the existing competitors, it is important to develop effective channels that will allow in managing the competition.  Hence, in such a scenario it is important to generate effective competition that will help in arranging efforts into a particular direction.  It is necessary to implement effective market strategy in order to generate better outcome. It is important enough in order to gain results that will allow in guaranteeing effective outcome by channelizing outcome. It is necessary to retrieve effective information in order to generate better results.  There is a necessity to develop favourable situation that has a potential to deal with the effective and reasonable (Walker, et al 2017).

Blockbuster Content: Netflix’s Global Rights and Shift in Regional License


This will however allow in arranging benefits in order to draw maximum results. It is necessary for generating better capacity and implementing the strategy in the best possible way. This will help in matching up the expectation of the people and the other possible results in order to maximize results. It is effectively important for a brand to generate adequate results and arranging effectiveness. It is necessary for arranging important results in order to generate effective results. Hence, this might create an issue with the Netflix in handling the market. This has created a potential damage to the brand in holding up the adequate level of brand distinctive objective. In a short tenure there are certain other service provider like Amazon Prime, Online web streamer etc. This has caused a potential damage to the brand.    It is important in dealing with the consequent objectives while briefing out the future strategy. These strategies will however help in dealing with the futuristic objective. In order to generate better results, it is necessary for gaining concrete futuristic goals that will probably allow in gaining international market growth. Thus, in order to gain organizational goals it is important to manage effectiveness created by the brand. Hence for an individual it is important to operate subsequently in order to maintain transparency. It is necessary for a brand like Netflix to accept the competitive aspects arising in the market. These strategies will therefore allow in managing consequent results on a long run.


Adhikari, V.K., Guo, Y., Hao, F., Varvello, M., Hilt, V., Steiner, M. and Zhang, Z.L., 2012, March. Unreeling netflix: Understanding and improving multi-cdn movie delivery. In INFOCOM, 2012 Proceedings IEEE (pp. 1620-1628). IEEE.

Bharadwaj, A., El Sawy, O.A., Pavlou, P.A. and Venkatraman, N.V., 2013. Digital business strategy: toward a next generation of insights.

Cammaerts, B. and Meng, B., 2011. Creative destruction and copyright protection: regulatory responses to file-sharing.

Chun, H., Kim, J.W., Morck, R. and Yeung, B., 2008. Creative destruction and firm-specific performance heterogeneity. Journal of Financial Economics, 89(1), pp.109-135.

Cowen, T., 2009. Creative destruction: How globalization is changing the world’s cultures. Princeton University Press.

De Figueiredo, J.M. and Kyle, M.K., 2006. Surviving the gales of creative destruction: The determinants of product turnover. Strategic Management Journal, 27(3), pp.241-264.

Diamond Jr, A.M., 2006. Schumpeter’s creative destruction: A review of the evidence. Journal of Private Enterprise, 22(1), pp.120-146.

Gallaugher, J., 2011. Information Systems: A Manager’s Guide to Harnessing Technology.

Hart, S.L., 2005. Innovation, creative destruction and sustainability. Research-Technology Management, 48(5), pp.21-27.

Hartshorn, J., Maher, M., Crooks, J., Stahl, R. and Bond, Z., 2005. Creative destruction: building toward sustainability. Canadian Journal of Civil Engineering, 32(1), pp.170-180.

Jenner, M., 2016. Is this TVIV? On Netflix, TVIII and binge-watching. new media & society, 18(2), pp.257-273.

Nagle, T.T., Hogan, J. and Zale, J., 2016. The Strategy and Tactics of Pricing: New International Edition. Routledge.

Porter, M.E., 2008. The five competitive forces that shape strategy. Harvard business review, 86(1), pp.25-40.

Santoso, S.M., Horne, B.D. and Wicker, S.B., 2013. Destroying by Creating: Exploring the Creative Destruction of 3D Printing Through Intellectual Property.

Shuen, A., 2008. Web 2.0: A Strategy Guide: Business thinking and strategies behind successful Web 2.0 implementations. ” O’Reilly Media, Inc.”.

Walker, R., Walker, R., Jeffery, M., Jeffery, M., So, L., So, L., Sriram, S., Sriram, S., Nathanson, J., Nathanson, J. and Ferreira, J., 2017. Netflix Leading with Data: The Emergence of Data-Driven Video. Kellogg School of Management Cases, pp.1-19.

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