For a while, Netflix was the only streaming option in town; competitive differentiation was not something it thought it had to worry about at first. While it first started out as DVD mailing, it has since evolved to streaming third-party content, original series, movies, and more.
However, as the landscape of streaming services changes, more options are becoming available. Finally, competitive differentiation is a major issue.
From Hulu to Apple TV Plus to Disney+ to HBO Now, Netflix isn’t the only option available anymore. The market is becoming increasingly saturated.
HBO Now gives users the benefit of accessing content only available on HBO Servers. Disney+ hosts a library of Marvel, Star Wars, Disney Animated Classics, and more.
What is Netflix doing to make sure it stays at the top of the market as more options pop up regularly?
As it stands right now, not much. In the first quarter of 2019, Netflix reported a revenue of $4.52 billion and a massive gain of 10 million subscribers. They do not appear to be worried about increased competition.
But while Netflix is doing well, Blockbuster was in a similar situation when Netflix was just starting out. In fact, the company laughed Netflix out of the room when it proposed a partnership for online and in-store branding.
While Netflix is correct in stating that, as it stands, it does not have to worry about the competition, that doesn’t mean it will be that way forever. Keeping the best brand strategy practices in mind, Netflix should take a page out of the book of its former rival and apply that going forward.
Just because you are the only and best option in town, doesn’t mean you can ignore being competitively differentiated. Other options will and do become available, with differentiation from your core offerings.
If Netflix doesn’t pay attention to this, it may suffer some setbacks. But who knows, maybe its earnings aren’t a fluke. Maybe Netflix is here to stay forever. But the same was once thought of Blockbuster.
— Ryan Kelley, Brand Strategy Account Coordinator