Despite buzz that “Millennials are killing businesses”, the domestic growth of businesses continues in America. Certain industries fare very well, while others that have been around since old times die off. One of the main factors in deciding which businesses prosper and which collapse is adaptation to and integration of technology. Netflix was founded in 1997 and operated solely by renting DVDs through mail service. It did not post profits until 2003, and in 2007 Netflix moved towards internet streaming. Now in 2017, Netflix exists as the premier Home streaming service, and an industry leader. So what made them successful in the era of dying businesses?
Throughout their timeline, Netflix has continued to innovate and stay ahead of the technology curve. By switching from DVD sales to online streaming, they continued to stay engaged with younger audiences. While this may not seem strange now, many successful businesses struggle with innovating from a familiar strategy that seems to work. Furthermore, Netflix has begun vertical integration of their industry. To quote Jack Donaghy of 30 Rock, “Imagine that your favorite corn chip manufacturer also owned the number one diarrhea medication.” Although Netflix’s strategy is not quite so diabolical, the idea is the same: control parts of the market that can be operated harmoniously under the same roof. By creating their own original content and making it exclusive to their platform, Netflix has moved beyond the role of streaming service for old TV shows and movies, and brought viewers in for new shows. Netflix has even gone so far as to try and create remote-like products for customers to control their experience outside of the platform.
It’s not as if Netflix doesn’t have any competition. Hulu, Amazon Prime, and HBO all have similar services and are producing original content. Netflix has created brand recognition and loyalty among its subscribers, and the exclusive content is a matter of quality and quantity. Netflix is investing more than any of its other competitors by far in new content. By creating a wide variety of shows, the potential audiences are all engaged. Netflix is also more available than any of its competitors. In almost every country in the world, with the most notable exception being China, people can use Netflix. This worldwide accessibility has benefitted greatly from a simple user interface and strong algorithm for suggestions.
Netflix has a lot of things going well, and currently it doesn’t look like much will change there. If they can continue to meet new technical trends head on and engage audiences with high quality production, they should stay on top. Netflix certainly stands out as an example of 21st century business working to stay ahead and prosper despite any economic hardships that may come.