NETFLIX VS BLOCKBUSTER Netflix was able to gain a competitive advantage over its chief rival Blockbuster. Discuss the Netflix value proposition and how it successfully gained an advantage over Blockbuster. a) Accessibility, affordability, and availability Netflix is affordable as it charges $7.99 per month while blockbuster charges $19.99 which is quite expensive. The company also does live streaming online of videos making them easily accessible and highly available as compared to blockbuster which does not operate virtually but uses physical stores (Guina, 2017). b) Customer retention Netflix paid people to view films and tag them with various kinds of metadata. The viewers were also trained to rate movies on different attributes like romance …show more content…
c) Creation of unique content Use of database of American predilections on cinemas and this helps Netflix to understand what they should be making. This way, the company produces exactly what the consumers want hence meeting their demands. d) Sequentially numbered URLs for Netflix Genres. The movies have been grouped together in the URLs using numbers. A URL ending with 1 has movies of crime documentaries for African American and a URL ending with 2 has the scary cult movies from the 1980s. Blockbuster could not do this. e) Use of digital devices. Netflix innovated away their movies could be streamed on mobile devices. This was a great advantage for competition as many people with handsets could access the videos anywhere, anytime (Grant, 2010). Blockbuster did not adopt the streaming of videos on mobile devices and relied on physical stores. A summary of the features making Netflix gain competitive advantage is in Exhibit 1 below (Deshpande, 2010). Identify and describe some of the technology innovations that Netflix was able to exploit and how these innovations contributed to competitive