Netflix Company Profile: Industry Analysis, Innovation and Ethics

This report provides a detailed profile of Netflix, a leading media and entertainment service, examining its industry structure as an oligopoly, market position, and size. It includes a SWOT analysis highlighting Netflix's strengths, weaknesses, opportunities, and threats, as well as a PESTLE analysis covering political, economic, social, technological, legal, and environmental factors influencing the company. The report also discusses Netflix's engaging areas, focusing on innovation drivers such as individual contributions, processes, products, and team efforts, along with its Corporate Social Responsibility (CSR) initiatives related to environmental sustainability and cultural practices. Finally, it addresses Netflix's governance and ethics, emphasizing transparency, adherence to laws, and ethical standards like cultural diversity and providing equal opportunities, ensuring a comprehensive overview of the company's operations and impact.

ESTABLISHING
COMPANY PROFILE
DETAILING

TABLE OF CONTENT
INTRODUCTION...........................................................................................................................3
1- Profile detailing of Netflix.......................................................................................................3
2- Discussing company's engaging areas.....................................................................................6
CONCLUSION................................................................................................................................8
REFERENCES..............................................................................................................................10
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INTRODUCTION
A business environment encompasses all the internal and external factors
and forces that affect an organization's operations. Those factors include,
customers expectations and needs, employees, technological innovations, demand
and supply, clients, suppliers, governmental activities, social trends, economic
changes, market trends, stockholders, management etc. These factors the firms
activities directly or indirectly and influence its operations.
Netflix is the world's leading media and entertainment service with millions of
paid membership subscribers, providing streaming service for variety of film, series
and documentaries. In the following report, the industry structure, market position,
market size of Netflix would be discussed. Furthermore, the strategic innovation,
customer social responsibility, and governance and ethics would be discussed in the
context of Netflix.
1- Profile detailing of Netflix
Netflix is an American online paid subscription streaming platform for films,
series, documentaries and other entertainment shows. It was established in 1997 in
Scotts Valley, California U.S. It has been dominating in the industry with only few
competitors in the market. Netflix is emerging as an innovative platform that
engages millions of people by providing amazing shows. Since there very few
companies as competitors, the structure of industry market could be identified as
oligopoly. In the oligopoly market only few companies are in control of entire
market. With Netflix other companies being, Amazon prime, YouTube and Hulu
(Budzinski, Gaenssle, and Lindstädt, 2020).
There are many internal and external factors that influences Netflix's
business operations and decision-making. For better understanding of those factors,
the SWOT and PESTLE analysis would be discussed below:-
SWOT Analysis of Netflix:
1. Strengths — The company has a global reach with strong brand
presence and reputation in the market. There growth is also
exceptional in the few years and the affordability gives even more
opportunity to attract potential consumers around the world

(Shatskaya, Sycheva, and Loktionova, 2017). There original shows and
films are also giving many opportunities to budding film-makers and
welcoming new concepts for those shows. Also, the shows from
different countries are now accessible to others reducing language
barriers through subtitles and dubbing.
2. Weaknesses — Although they have reduced language barriers, there
are still lack of original content in some countries, making it less
appealing. The subscription charges are little expensive for some
countries which limits its reach. And the biggest weakness of them are
lack of quality customer care services, which can affect their
customer's satisfaction.
3. Opportunities — As the digitalization is rising the demand for OTT
platforms is also rising which is very beneficial for Netflix. This current
demand of OTT platforms can help Netflix to expand their market
(Rataul, Tisch, and Zámborský, 2018). They can collaborate with local
markets to establish themselves strongly in other nations and as they
have global presence they can develop there business by expanding
there business in other sectors like gaming and comics.
4. Threats — There are many new competitors that are entering the
market in recent years with new concepts that can be threat to the
company. Also, in some countries the government has regulated and
restricted Netflix's accessibility which can limit its expansion. The main
concern surrounding there services is content piracy. Many people
reach to those pirated content instead of paying for the subscription,
threatening its content. And people also share there account which
lesser there consumer count.
PESTLE Analysis of Netflix:
1. Political — Political factors are the influence of government and their
policies that influences the company. It includes factors like, foreign
trade policy, tax, fiscal policy and other regulations. There are some
countries which have no access of Netflix because of political
restrictions like North Korea, Syria and one of the largest economies
like China that has banned use of the respective OTT platform which

affects its reach to potential consumers and limiting their profit
making.
2. Economic — Since Netflix operates in many economies that are very
different from each other and can affect its services. Factors like
demand and supply graph, inflation rate, exchange and interest rate
can determine consumers purchasing power which controls their
revenue. The exchange rate while buying content from others
fluctuates frequently which affect the company's profit but the original
content may help. And the steady growing subscription prices can
make people hesitate to buy it.
3. Social — Any company or organization exists in a society. So, its
cultural norms, trends and customs affects it directly or indirectly.
Every different demographic the social factor changes accordingly. The
societal factors that influences Netflix are age, gender, purchasing
power, social class, salary and interests. The company has sorted their
content keeping those factors in mind and that could be one of the
reason for their success. They have targeted the younger audience and
can be found more popular between women (Turner, 2019).
4. Technological — Innovation is driving force for many businesses
(Lima, M., 2021). This advancement brings new customers and help
them to retain in the market. Netflix has taken innovation in their
businesses practices. They have introduced high quality internet
streaming of shows and films through mobile phones, they also have
automatic translation software in the system that is quite popular
among its customers.
5. Legal — The companies are supposed to abide with every law of the
country they exist in, they must follow it to remain in that country and
run their business. The laws for company like company laws, consumer
laws, labour laws, copyright, discrimination laws, health and safety and
many other laws should be followed by them. There are some
instances when Netflix got in conflict. Once with the customers over
sudden hike in price that ended up in lawsuit against them and other
times due to copyright claims which are still in need to be resolved and
company must come with some strategy.

6. Environmental – The growing concern for environment has affected
every person or business. The concerns like reusable resources, low
carbon emission, focus on sustainability, low carbon footprints and
emission and other ecological concerns should be in focus of
organizations. Netflix is showing constant efforts to help the
environment like investment in EPA, reduced paper use in work, yet
they should focus on energy saving.
2- Discussing company's engaging areas
Innovation is defined as the strategy used by various companies to
improve their existing product or service with adding new methods for
relaunching and replacing (Cohen and et.al., 2020). It is required by firms for
increasing sales revenue and addition of new values to products. Various
drivers of innovation being used by 'Netflix' for increasing their profits and
revenue of firm, such as:-
The Individual — The brand focus on innovation, because it's a part of
everyone's job for reinventing or changing services by company, for being ahead of
their competition. Idea derived by an individual to rent and play film and shows at
cheaper prices and easy to deal with. With the usage of this driver for innovation
enterprise made possible to overcome competitors and gaining customers.
The Process — Another driver that aid company in innovating new trends
and processes innovation on a daily basis (Hughes and et.al., 2018). Being
continuously inventing new services at individual, group and whole firm level. With
the help of this driver firm may introducing the 'subscription model' for the very first
time. The second biggest innovation made till date, earlier been very clumsy and
problematic process about whom to deliver services. With this consumers now able
to pay and being able to watch series and other contents according to their
preferences.
Products — With the help of this driver firm may go further than just
developing services. By providing customers with their own personalized
recommendation system. Now consumers been able to see related shows as, the
developed technology showcase customers with wide variety contents according to

ratings and reviews. This innovation helps enterprise to dominate the market by
getting regular watching from the consumers.
The Team — Developing a team focuses on brainstorming about new
innovations may be done (Carlini and et.al., 2019). With this driver firm may able to
develop 'exclusive content' which simply means original programming. As delivering
new and original exclusive content to their subscribers only. With dealing with top
entertainment companies to showcase or air their series on Netflix only.
Also with the usage of strategic innovation company developed 'Blocking
VPNs' feature allow for anti-theft of content, and not being able to capture or screen
record and sell privately. This feature aids firm to go far ahead of competition and
gain a huge competitive advantage in market.
CSR — As the name suggest describe as the Corporate Social Responsibility
model aims at gathering various social and cultural practices by giving back to
society (Pham and Tran, 2020). It is a continuous process to work more ethically
and being able to contribute to society with improving lives of their employees. As
the higher CSR of firms aids in attracting more customers and gaining more
profitability in the market. Netflix, CSR works on business standard maintaining and
following ethics and morality.
Environmental Sustainability — One of the main CSR of Netflix is to
achieve net-zero gas emissions till the end of year 2022. The company also aims in
focusing and conserving natural areas including tropical rainforest, maintain
mangroves and resorting grasslands. As with increasing carbon footprints while
producing documentaries company also aims in raising awareness and reducing it.
On-sites Solar panels — The company also introduced or established
various solar panels for conserving fuel efficiency. With the installed solar panels
company provides 100% renewable energy which aids in maintaining environmental
sustainability. Another efficiency being provided as charging all parking for electric
vehicles.
Cultural Practices - Under this CSR firm aims to provide culture diversity by
acknowledging every member around the world (Bui and et.al., 2019). Netflix allows
equitable pays and various benefits for all their workers. This creates transparency
between employees.
The mostly practices undertaken by Netflix for performing CSR to their
employees and society both.

Governance and ethics — This simply means the processes done by the
company may being recognized and followed by government laws and rules along
with ethical behaviours followed (Sheehan, Dunn and Sahan, 2018). Netflix's
approach with governance with providing transparency and following the corrective
rules and regulations enforced by law. Enterprise aims to follow all the board
practices by sharing goals and accountability with government. Company also
follows rules as, all the content delivered on site is being judged and falls under
governance rules. Another governance check by providing customers with all
verified or certified themes and series to consume with. Apart from this Netflix also
provides with code of conduct to all their members and board of director
showcasing about the norms of company and what need to be followed. Whereas in
ethics firm initiates to follow all the ethical standards under which firm or business
works. As the company follows various code of ethics to follow:
1. Cultural Diversity — Under this enterprise follow and aims to
make and maintain cultural diversity in between the employees. With
the different people from various nation working company does
provides and treats all with same level of integrity and equally.
2. No harmful content — With providing content that cause no
harm to any of their consumer. By providing an equal platform to all to
see and giving diversified content which don't specify any culture or
cast or showcasing any of destructive show which harm mindsets of
their consumers.
3. Providing equal opportunities — Another ethical value
provided by Netflix is by proving equal rights and opportunities to their
workers for maintaining an equal environment for all. The company
allows their workers to brainstorm and introduce everyone with ideas
and if the idea is worth, firm will apply that innovation or idea in
regular terms. Giving an equal rights and authority to showcase their
talents for the firm's effectiveness.
CONCLUSION
From the above study it has been concluded that business environment of
any organization is important to address various working of it. With the different

variation in company's working environment tends to result in many outcomes. The
current study will show about the company's structure and how firm organized its
activities. The study also showcase about the market in firm operating and position,
local market and size of the firm is operating. Further, report delivers about the
innovation and strategic innovation enterprise areas of engaging. Lastly the report
showcase about corporate social responsibility and also governance and ethics of
the firm.

REFERENCES
Books and Journals
Budzinski, O., Gaenssle, S. and Lindstädt, N., 2020. The Battle of YouTube, TV and
Netflix–An Empirical Analysis of Competition in Audio-visual Media Markets.
TV and Netflix–An Empirical Analysis of Competition in Audio-visual Media
Markets (March 31, 2020).
Bui, S. and et.al., 2019. Systemic ethics and inclusive governance: two key
prerequisites for sustainability transitions of agri-food systems. Agriculture
and human values. 36(2). pp.277-288.
Carlini, J. and et.al., 2019. The corporate social responsibility (CSR) employer brand
process: integrative review and comprehensive model. Journal of Marketing
Management. 35(1-2). pp.182-205.
Cohen, J. and et.al., 2020. The Interrelationship between Corporate Social
Responsibility and Strategic Innovation In Aveiro-based Startups.
International Journal of Business Research and Management (IJBRM). 11(3).
pp.65-86.
Hughes, D. J. and et.al., 2018. Leadership, creativity, and innovation: A critical
review and practical recommendations. The Leadership Quarterly. 29(5).
pp.549-569.
Lima, M., 2021. Model–Business Models for Innovation Strategies. Innovation
Economics, Engineering and Management Handbook 1: Main Themes.
pp.233-241.
Pham, H. S. T. and Tran, H. T., 2020. CSR disclosure and firm performance: The
mediating role of corporate reputation and moderating role of CEO integrity.
Journal of Business Research. 120. pp.127-136.
Rataul, P., Tisch, D. G. and Zámborský, P., 2018. Netflix: Dynamic capabilities for
global success. SAGE Publications: SAGE Business Cases Originals.
Shatskaya, E. Y., Sycheva, N. S. and Loktionova, O. S., 2017. SWOT-ANALYSIS AS A
BASIC TOOL IN MARKET RESEARCH. In EUROPEAN RESEARCH: INNOVATION
IN SCIENCE, EDUCATION AND TECHNOLOGY (pp. 39-41).
Sheehan, M., Dunn, M. and Sahan, K., 2018. In defence of governance: ethics review
and social research. Journal of Medical Ethics. 44(10). pp.710-716.
Turner, G., 2019. Approaching the cultures of use: Netflix, disruption and the
audience. Critical Studies in Television. 14(2). pp.222-232.