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Netflix vs. Blockbuster Case Study
1. Netflix vs. Blockbuster
The Rise of Video-on-Demand
Blockbuster’s Viable Options: Buy Netflix, or Become Netflix
A Case Study by Angela Collins, Gaylene Meyer,
and Lily Zimmerman
Summer
2018
3. Netflix’s (Customer) Data-Centric Strategy
Netflix Tracked specific dimensions of
customer use like:
- Total time spent on Netflix site
- Patterns among actors, directors,
and genres watched
- Time-gap between shows watched
on Netflix site
4. Where did Blockbuster go wrong?
Greed
Hubris
Lack of customer-centric business model.
Inability to adapt and make the operational changes to
harness power of customer data
Netflix offered to sell to Blockbuster and they “laughed
[Netflix] out of the office”.
Inflexibility
5. Blockbuster’s Options - Missed Opportunities
Buy Netflix
Failed 50 Million Dollar sales offer to Blockbuster
Become Netflix
Blockbuster was inflexible and unable to accurately read the changing
market
7. Netflix - Threats & Opportunities
Threats
- Risk of shifting too much focus/resources toward
the streaming side of the business before enough
consumers have adopted VOD as a
regular/preferred form of media consumption
- Lack of established partnerships with studio /
content-producers (in contrast to Blockbuster)
Opportunities
- Fast growing customer base
- Boldness and nimbleness to adapt to changing
technological environment by leveraging
customer data.
