netflix public relations case analysis
DESCRIPTION
this is the analysis of the situation faced by Netflix in 2011. The major reasons being sudden price hike and lack of communication between company and consumers.TRANSCRIPT
NETFLIX: The Public Relations
Box Office FlopPresented by-
Kuhu Pathak
Abhijeet Thorat
Case Synopsis-
• The world’s largest internet subscription service for watching
movies and TV instantly with more than 25 million members
worldwide.
• Netflix is revolutionizing the way people watch movies and TV
shows by streaming directly to them.
• Netflix has become the preferred online provider of the
entertainment experience in the U.S.A.
• Netflix streams on:
• Microsoft
• Xbox 360
• Nintendo Wii
• Sony PS3 console
• Blu-ray disc players
• Internet-connected TVs
• Home theater system
• Internet video players: Apple iPhone, iPad and iPod touch, Android devices, as well
as Apple TV and Google TV.
• During the first quarter of 2011, sales and rentals of packaged DVDs and
Blu-ray Discs plunged about 20 percent, and the sell-through of packaged
discs fell 19.99 percent to $2.07 billion, with more money spent on
subscription rentals than in-store rentals
Fast facts
Spilt into two companies.
Increased prices 60%.
In 2003, 1st Operating profit achieved.
Focused on Content Online Streaming.
1997- Reed Hastings & Marc
Randolph founded Netflix
1999- Change of plans-Monthly
fee
2000- 300,000 subscribers(but still in losses)
May 2002-released IPO
2003- 1st
operating profit2007- 1 Billionth
DVD rented
2010- Global Expansion
2011, Sept-Prices Increased
60%2011, Qwikster
Timeline-
Lack Of Communication
Price Increase
Response time
Lack of comparable selection between DVDs by mail and Instant Stream
Customer’s dissatisfaction
Not developed business strategy
Brand Image Degradation
Netflix statistics
0
5
10
15
20
25
2007 2008 2009 2010
Members In millions
0
20
40
60
80
100
120
140
160
180
2007 2008 2009 2010
Net Income in $million
Recommendations: Alternative Business Models
Bundle services with
pay-tv packages.
Less money from more customers =
Revenue boost
Less competition = Lower licensing fees
Customers sign up for
service directly on
AppleTV & pay through iTunes.
Reach more customers = Revenue
boost
Partner with gaming
companies to offer on-
demand video game services.
New customer segment = Revenue
boost
Develop “HBO quality” original content.Lure & retain
customers with content that’s untouchable by competitors = Revenue boost
Conclusion
• Customers still enjoy Netflix capabilities
Mostly good feedback
Netflix performs well against competitors
Supporters create social media buzz
• Price, prompt delivery, communication method
Main obstacles: