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Netflix’s Generic Strategies Netflix is using a focused differentiation strategy. Netflix’s subscriber base consisted of three types of customers: those who liked the convenience of home delivery, bargain hunters who were enthused about being able to watch many movies for an economical monthly price, and movie buffs who wanted access to a very wide selection of films.
SWOT Analysis
Strength:
* Netflix is the world’s largest subscription service for streaming movies. It had attracted 14 million subscribers as of April 2010. * Netflix has the fastest delivery time compare with any other online DVD rental companies. As of 2010, additional improvement in Netflix’s distribution and shipping network had result in one-business-day delivery capability for 98 percent of Netflix’s subscribers * Netflix has no late fees and no due dates which eliminated the hassle of getting DVDs back to local rental stores by the designated due date * Netflix had been highly rated in online retail customer satisfaction by Nielsen Online and ForeSee/FGI Research. Weaknesses: * Netflix accesses only to internet users * Subscriber cancellations are increasing from 3,113,000 in 2006 to 6,444,000 in 2009. (To grow its subscriber base, Netflix should attract new subscribers as well as avoided cancellation.) Opportunities: * As the result of growing demand of streaming video, online movie rental is rising. Netflix has a large capacity to attract more subscribers. * Expansion into foreign markets * Price for wide-screen HDTVs had been dropping rapidly, and picture quality was exceptionally good.
Threats:
* DVD competition from Redbox and Blockbuster * Technology changes rapidly, old technology is

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