Netflix and Consumer Behavior Trends

3137 words 13 pages
Netflix, Inc. is a subscription-based movie and television show rental service that offers media to it’s subscribers through on-demand internet streaming and DVD-by-mail service. Since its start in 1997, Netflix has taken the movie rental world by storm, becoming the world's largest online movie rental service. As of January 2013 Netflix had a total of 29.4 million streaming customers worldwide (Cohan). Netflix can attribute much of its success to its decisions to follow trends in consumer behavior, while its major competitors, namely blockbuster, sealed their fate by ignoring them.
In the following paper I will tell you how Netflix was able to stay afloat while other movie rental companies failed, and gained success by following trends
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From the beginning Netflix offered consumers an affordable means to entertainment by charging users a reasonable flat fee to have DVDs mailed to them as often as they want, without any late fees (Cohan). Today, Netflix’s more prominent service, instant streaming video, offers consumers the same affordability as its DVD by mail service. The company provides consumers with a very affordable subscription plan- unlimited streaming movie rentals for $7.99 a month. CEO of Netflix, Reed Hastings believes that at this price “people who use it once or twice a month will still find value and come back and those who use it once or twice a week will rave about it to friends (Kim).”

Due to the rise in smartphones and tablets, and the amount of things consumers use theses devices for Netflix made the decisions to expand their service offerings to smartphones and tablets. In May of 2011 Netflix released a free application consumers can download on their smartphone or tablet that allows them to instantly stream movies and television shows to their smartphone anywhere there is WiFi, as long as they have a subscription (Brown). Consumers were very impressed with the quality of the video streaming Netflix was able to provide via smartphone or tablet, “Over WiFi viewing is superb-- as though you were looking at a DVD not a video streamed off the internet (Brown).”


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