The company Netflix, which started with 1997 thirty-five employees, has made it a dream for people to go to the theater and watch movies. It’s okay, today Netflix has become the number one OTT platform in the world, with more than two hundred and twenty million daily active users and today Netflix’s market value is more than eight billion dollars, which is twice the GDP of Sri Lanka and Nepal.
Now here comes the most important question that how a DVD player selling company is dominating the entire internet industry today and another very important question comes here that how at one time its biggest competitor Blockbuster which is nine thousand Used to sell DVDs with more than 80,000 stores and more than 85,000 employees, they beat it and not just beat it, acquired it and created a new market of its own.
Will know everything in interesting and knowable blog Let’s read this explosive blog and case study.
Story of Netflix Success Starts Here
The story begins in 1997 when Netflix CEO Reed Hastings rented a DVD from Blockbuster to watch a movie called Apollo Thirteen, but was charged an extra forty dollars for returning the DVD six weeks late. Late fee was charged on the same day when he was doing exercise in the gym. Then he got this idea that DVD rental business is very bad, what happens if you get a little late, they start charging extra fees.
Better than this is the gym business where once you pay the membership fees, the number of hours you want to exercise, you can use their equipment, no one is going to stop, with this thought he started an online DVD rental business. But this business was very different from before, in this only the customer had to pay sixteen dollars, in which he can keep four DVDs at a time and can rent any number of DVDs, there was a good condition that if you have any If the DVD gets late, then no extra and late fees will be charged in giving it, and the second is that due to Netflix being online, the recommendation system was working well on it from the beginning.
So that he was able to know which DVD is liked or not liked by the customer. On seeing this model, the customer was very attracted and started selling more than 10,000 DVDs a day on Netflix. Because of this, a profit of one point two billion dollars was generated in 2003 months, after getting such a huge success, if it was any ordinary CEO would have said that the business is going well, let it run, But here Reed Hastings did not do this at all, he thought that the business of DVD rental is not going to go ahead at all.
Because, there are many faults in it, firstly, to watch movies on DVD, first of all, you must have a DVD player, secondly, you cannot watch movies everywhere on DVD, specially you have to watch movies sitting at home, and thirdly, the customer in DVD There was no wide variety of choice at all and when we talk about TV, you can watch it only at a particular time to watch any movie or show.
If it is missed at one time, then you cannot give it until the repeat telecast is done, and the second problem is that the show has longer ads than the show. Reed Hastings, the founder of Netflix, identified all these problems. Launched the world’s first online streaming platform for just Rs 199 anywhere, i.e. in the bus, in the train, in the bedroom, in the bathroom and anywhere, i.e. on tablet, on TV, on computer, on mobile you can watch Netflix can enjoy.
You can enjoy and not only this, you can watch your favorite web series for ten to fifty times on Netflix by paying just Rs 199. You will neither get this option in theaters nor on TV. Due to a revolution, today Netflix has earned a profit of more than thirty billion dollars in the year 2021 and due to this, many more platforms are being born due to Netflix, which are trying to become competitors of Netflix. But Netflix has become the king of this market today.
Second, the biggest thing that comes here is how they achieved this position by beating their biggest competitor Blockbuster, then the story starts like that the company was selling out on DVD rental by opening a physical store, while Netflix like I Told you that online DVDs used to earn money by selling out, due to which Netflix bought DVDs only when they received orders from the front, due to which Netflix did not have any inventory problem.
Blockbuster used to sell DVDs on rent and due to which if any user was a little late, then he used to charge extra fees for DVDs, while Netflix made it absolutely free and unlimited, this model of Netflix was creating a ruckus in the US.
Seeing this, in the year 2004, Blockbuster also started the business of online DVD platform rental, but their entry in the market was very late, till then Netflix had captured this market with six point three million subscribers and there Blockbuster was able to choose only two million subscribers and the most important question here is how long Netflix will continue to sell the same old DVDs.
How long will the same series and movies continue to be shown to the people, now Netflix along with itself and other big production creators started producing their own web series movie TV shows and while Blockbuster remained stuck only in DVD and CD and over time Blockbuster went bankrupt in the year 2010 due to people doing continuous innovation and only Netflix acquired them for eighty million dollars.
Such a huge DVD rental business that they acquired in Blockbuster, they lost only because of no continuous innovation and this is the reason why Netflix has become the king of such huge marketing today because of their continuous innovation.
