Netflix offers prepaid subscription service whereby customers only need to sign up and pay a fixed subscription fee a calendar month for unlimited rentals. Customers will now have no more(prenominal) worry of returning their movies late, as Netflix has cancelled the late-fee system. This model enables Netflix to guarantee its slower delivery time in comparison to smash hit brick-and-mortar model. Instead of making it difficult for customers to unsubscribe its service, Netflix made the unsubscription process comparatively easy and adopting the strategy of reclaiming churned customers rather than forcing dissatisfied customers to stay.
Netflix in like manner offers a web portal with powerful features such as a proprietary recommendation system that was very accurate in recommendations, due to exploiting the knowledge of the choices made by the masses in its web portal as healthy as having the largest hookup of movie ratings. Customers are recommended to movies based on their preferences as well as the availability of the movies.
Being the first company that suppose into the online videodisks rental retailing, Netflix gain a first mover advantage. Netflix has gained a good reputation as well as a large base of customers over the years.
Beside having a good and fast relationship with several major studios which enable them to acquire up-to-the-minute releases at a faster time and lower cost, Netflix also successfully gain resources from independent film studios whereby creating a quoin in the market. Therefore, customers can maturate a whole all-encompassing range of movies (including those lower-profile and independent films as well as before released movies) from Netflix as compared to other competitors.
Weakness of Netflix
Although the prepaid subscription service did servicing Netflix to gain new customers and revenue, yet this model do not work with low volume customers (i.e. customers who rent a DVD once in a blue mood). High switching inventory cost will occur since DVDs might get lost or...If you want to get a full essay, nightspot it on our website: Orderessay
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