23 February 2017 13:02:49 IST

Formulate country-specific strategies to succeed

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Netflix US’ strategy cannot be expected to work in India

Netflix, a US-based video streaming company, was founded on August 29, 1997. Though it started off as a mail order movie distribution service, it now specialises in providing video-on-demand services online to consumers around the globe.

Till date, it has 81 million consumers and a presence in 190 nations. The specific services it offers include streaming TV shows and movies on all kinds of screens, such as TVs, computers, tablets, and mobile devices.

It also has a strong model for DVD subscription that facilitates unlimited rental of DVDs to its consumers on a monthly basis. By the end of 2007, the company shipped approximately 1.6 million video discs. By the end of 2015, Netflix’s overall revenue was a staggering $6.78 billion.

In pursuit of growth

In pursuit of expanding its top and bottom line growth, it entered India in early 2016. However, since its entry, the company has not seen much success, so far as its revenue, profit and brand acceptance are concerned.

Against this backdrop, a detailed SWOT analysis of the company is given below.


Given these circumstances, Netflix India should aim to formulate strategies that reduce its weaknesses and neutralise some of the threats. Simultaneously, it should also attempt to leverage its strengths and take advantage of the opportunities present to ensure success in India.

The following marketing strategies may help Netflix.

Segmentation and targeting

Netflix can segment the Indian market based on a set of geo-demographic variables.

a) Location of consumers

b) Age

c) Income

d) Education

e) Occupation

Its target audience should be consumers in Tier I and Tier II cities (because of high internet speed and penetration), aged between 18 and 50 (a wide range of consumers will be available within this range), are educated, and have mid or high income (to be able to spend ₹500 every month for video-on-demand services).

As for occupation, university students, young working people, housewives, and corporate professionals who have just become parents (because the need of binge watching can be easily created) would be potential consumers.

Value proposition and positioning

This should hover around the need for quality offerings. Potential viewers should be able to consume a large amount of content at one go, with least interference from advertising.

The company should also highlight the unique content available at Netflix, such as American TV shows, Netflix original productions, the latest Hollywood movies, and old Bollywood classics. Finally, Netflix can also try to slowly discourage consumption of pirated video content.

Product strategy

The following products should be developed or made available for Indian viewers.

~ Videos in basic or standard resolution format. High Definition (HD) and Ultra HD are not necessary, considering the internet speeds available in India, which would not match that required by the videos.

~ Focus on unique content like TV shows produced or released by Netflix, including House of Cards, Turbo Fast, All Hail King Julien and The Mr. Peabody and Sherman Show , among others.

~ Latest Hollywood movies

~ Old Bollywood classics

~ Business news

~ Indian TV soap operas (Hindi)

~ Cricket tournaments (Indian Premier League, and all other cricket tournaments), and other sports tournaments (Pro Kabaddi League, Indian Super League, etc)

~ Reality shows like MasterChef India, Dance India Dance, Big Boss and Indian Idol.

~ Regional or State-specific TV soap operas

~ All English video content should have sub-titles (Hindi/English)

Pricing strategy

Since Indian consumers are extremely price-sensitive, Netflix’s present subscription plan will not be very successful in India.

It needs to create a perceived value pricing, where customers are able to subscribe for a basic plan on a monthly basis at a low rate (such as ₹99 per month) and then customise their plans (₹75 for latest Hollywood movies, ₹49 for Bollywood classics, ₹99 for Indian Premier League).

This customisation should be flexible enough, so consumers can add or delete a package, whenever they require.

Some additional strategies that might also be provided are:

~ Strategic alliances with telecommunication companies and broadband internet service providers to introduce combo offers (such as a Vodafone connection that will enable a free one month Netflix subscription. After a month, the customer can start a paid membership).

~ Freemium (free access to Netflix for one month + premium after trial period). Such a strategy might induce potential consumers to try the same.

Promotional strategy

Keeping in mind the above-mentioned positioning of the brand, the following promotional strategies can be adopted in India.

~ Television and print advertisements about Netflix in Tier I and Tier II cities that will create brand awareness. National TV channels and newspapers should be selected for this purpose.

~ Online campaigns using YouTube and Facebook.

~ Brand engagement with users through online contests and sweepstakes.

~ Online marketing through referrals and Google AdSense.

~ Outdoor advertising (billboards, banners, and hoardings in crowded places)

~ Use of pamphlets and leaflets to reach selected target audiences, such as college students, housewives and other such target audiences.

(The author is Associate Professor, Department of Marketing and Strategy, ICFAI Business School, Hyderabad.)