Domain: Strategic Management
NetFlix’s business strategy is well aligned to the basic requirement in a movie rental business.
They have a wide selection of videos and cater to almost all genres. Another key element to
video rental business is fast delivery of rented DVD’s. As for NetFlix’s, delivery channel, they
proudly claim 98% on time delivery on orders. The third and the most important niche required
to become a market leader in this business is low cost of subscription. NetFlix has near zero
rental charges for its subscribers and that is what sets it apart from its rival firms. Having
satisfied the 3 basic criteria’s for successful business, this paper is aimed at examining what were
the possible driving forces that led to such good market standing of the company. Along the
same discussion we also point out various strategic and competitive challenges that the firm
might face in near future and suggest means to minimize the impacts of those threats.