AMN442: Netflix India Market Analysis and Recommendations

This report provides a comprehensive market analysis of Netflix in India, examining the external marketing environment through PESTLE and Porter's Five Forces models. It explores the political, economic, social, technological, legal, and environmental factors influencing Netflix's performance, as w...Read More

Running head: MANAGEMENT
Management
Name of the Student
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Author note

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Executive Summary
The assignment has been beneficial in understanding the different external and macro
environmental aspects which are impacting Netflix’s performance in Indian economy. From
PESTEL as well as Porter’s Five Forces Model Analysis, it has been seen that the company has
high level of substitute threats and due to political instability that can be improved by using the
opportunities suitably.

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Table of Contents
1) Introduction.................................................................................................................................2
2) Netflix-India Market Analysis.....................................................................................................2
2.1 PESTLE Analysis..................................................................................................................2
2.1.1 Political...........................................................................................................................2
2.1.2 Economic........................................................................................................................2
2.1.3 Social..............................................................................................................................3
2.1.4 Technological.................................................................................................................3
2.1.5 Legal...............................................................................................................................3
2.1.6 Environmental.................................................................................................................3
2.2 Porter’s Five Forces Analysis................................................................................................3
2.2.1 Competition in Industry..................................................................................................3
2.2.2 Potential of New Entrants in Industry............................................................................4
2.2.3 Power of Suppliers..........................................................................................................4
2.2.4 Power of Buyers.............................................................................................................4
2.2.5 Threat of Substitute Products..........................................................................................4
3) Recommendations.......................................................................................................................4
3.1 Strengthening Distribution Network......................................................................................4
3.2 Offering low cost Subscription to Customers........................................................................5
References........................................................................................................................................6

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1) Introduction
The assignment helps in understanding the case study of Netflix in India: The way ahead
Case which has been trying to keep their presence in market of India from the last few years. The
respective case study is mainly based on the current strategic along with managerial problems
which are being faced by the company and it needs to be solved in the tactful manner for
allowing the progression along with maintaining the competitive position in the market. The
respective paper has been written for facilitating the case study for the Netflix in India: The way
ahead Case. During 2016, Netflix is capable of achieving profitability in inaugurating the
business in economy of India. The purpose of the company was related to providing the SvoD
related service as they thought that in economy of India, the income of the people can be
increasing along with raising spending money among customers regarding the same. However,
on the other hand, there were competitor companies such as Eros and Hotstar which are
providing customers with cheap priced products (Harvard Business Review, 2020).
2) Netflix-India Market Analysis
2.1 PESTLE Analysis
The macro environmental analysis is identifying the possible opportunities along with
threats which will be influencing the growth of Industry as the whole and which are outside
power of industry.
2.1.1 Political
There is instability in political environment of Indian economy that can influence the
activities related to the company. In the India’s economy, there is opportunity for them in which
the government can be helping through providing regulatory requirements and monetary help.
On contrary, lack of the political stability and high rate of taxes can be impacting business tasks
of Netflix negatively (Teece, 2019).
2.1.2 Economic
In the economy of India, the GDP is high that can be providing immense opportunity to
Netflix in showcasing their talent in meeting demands of individuals (Rebs, Brandenburg &

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Seuring, 2019). On contrary, there is unemployment present in India that can be ruining Netflix’s
business in a certain manner as people may prefer to opt for the cable operator choices which can
be negative threat (Pröllochs & Feuerriegel, 2020).
2.1.3 Social
As there is presence of different competitor companies namely Eros and Hotstar,
therefore, people prefer to opt for the cheaper ones. It can be the major threat for Netflix to retain
their position in India (Macke & Genari, 2019). Additionally, Netflix may not be affordable by
the different people whose social status is lower and it can be creating pressure on Netflix in
making their position.
2.1.4 Technological
With the advent of technology in India, it will be creating different opportunities for
Netflix in improving their operations related to commencing business. In the entertainment and
media world, the technological aspects play a crucial role in improving their position in India and
it will help them in achieving high profitability and revenues (Köseoglu et al., 2019).
2.1.5 Legal
There is pressure of the various laws and legislations that can be required for Netflix to
be followed. The guidelines are strict and it is needed to be followed by Netflix for maintaining
their position in India and it can be critical for them that includes fair kind of compensation as
well as no discrimination laws (Kamariotou & Kitsios, 2019).
2.1.6 Environmental
In economy if India, there are different individuals who prefer to move their focus
towards the environmental protection and safety. Netflix needs to follow environmentally
sustainable for managing the growth in an appropriate manner.
2.2 Porter’s Five Forces Analysis
2.2.1 Competition in Industry
It is high as Netflix has to face various competitors namely Eros and Hotstar that can be
influencing the operations. As the Indian customers prefer to choose the cheaper options,

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therefore, the Hotstar and Eros are the sustainable options that can impact position of Netflix
negatively.
2.2.2 Potential of New Entrants in Industry
It is less as in entertainment industry, the requirements of capital are strong and the
organizations that are planning to invest in such industry can be finding it highly difficult. In
such case, Netflix can be gaining high loyalty for attracting large number of customers
(Drobyazko et al., 2019).
2.2.3 Power of Suppliers
It is reasonable as in the respective sector, there are large numbers of suppliers present
and the companies such as Netflix will be able to receive different contracts from suppliers.
Additionally, the independent suppliers can be capable of analyzing situation and generating
high shares.
2.2.4 Power of Buyers
It is high as they have different other options open to them that can be providing them
with opportunity to opt for the cheaper subscription companies. It can be influencing Netflix’s
business in India and for such; they need to implement the different moderate economies related
to scale for cost management that will be capable of improving growth (Bals et al., 2019).
2.2.5 Threat of Substitute Products
It is high as Eros and Hotstar are the two major options available to customers which can
be impacting the growth of the company. The subscription is high for Netflix and impacting their
operations negatively (Drobyazko et al., 2019).
3) Recommendations
There are two major recommendations that are needed to be implemented by Netflix for
managing their operations sustainably in market in Indian economy which are as follows:
3.1 Strengthening Distribution Network
It is the first recommendation that is required to be implemented by Netflix that can be
allowing them to take better control in comparison to other companies which are the major
competitors in economy of India. As to properly improve their sustainability practices and

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generating easy kind of availability of products, the relationships with the Indian customers will
be strengthened and improving (Simandan, 2019).
3.2 Offering low cost Subscription to Customers
In economy of India, the high level of penetration along with SvoD providers present, in
such case, Netflix is required to provide the customers with the different services at lower prices
that will be helping them in managing the large number of customer base (Simandan, 2019). The
proper joint partnership with internet streamers can be capable of implementing the efficient
level of opportunity for managing their presence and operations successfully in respective market
scenario that is lacking high effectiveness related to services which are costly in nature.

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References
Bals, L., Schulze, H., Kelly, S., & Stek, K. (2019). Purchasing and supply management (PSM)
competencies: Current and future requirements. Journal of purchasing and supply
management, 25(5), 100572.
Drobyazko, S., Okulich-Kazarin, V., Rogovyi, A., & Marova, S. (2019). Factors of influence on
the sustainable development in the strategy management of corporations. Academy of
Strategic Management Journal.
Harvard Business Review (2020) Netflix in India: The Way Ahead (Online) Retrieved from
https://services.hbsp.harvard.edu/api/courses/706909/items/W17100-PDF-ENG/sclinks/
ba3d3f1049cfefcdb9b084a9ae6f1646 [Accessed on 1st April 2020]
Kamariotou, M., & Kitsios, F. (2019). Strategic information systems planning. In Advanced
Methodologies and Technologies in Business Operations and Management (pp. 535-
546). IGI Global.
Köseoglu, M. A., Okumus, F., Dogan, I. C., & Law, R. (2019). Intellectual structure of strategic
management research in the hospitality management field: A co-citation
analysis. International Journal of Hospitality Management, 78, 234-250.
Macke, J., & Genari, D. (2019). Systematic literature review on sustainable human resource
management. Journal of Cleaner Production, 208, 806-815.
Pröllochs, N., & Feuerriegel, S. (2020). Business analytics for strategic management: Identifying
and assessing corporate challenges via topic modeling. Information &
Management, 57(1), 103070.
Rebs, T., Brandenburg, M., & Seuring, S. (2019). System dynamics modeling for sustainable
supply chain management: A literature review and systems thinking approach. Journal of
cleaner production, 208, 1265-1280.
Simandan, D. (2019). Iterative lagged asymmetric responses in strategic management and long-
range planning. Time & Society, 28(4), 1363-1381.

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Teece, D. J. (2019). A capability theory of the firm: an economics and (strategic) management
perspective. New Zealand Economic Papers, 53(1), 1-43.