Chapter 7- Product Differentiation

Product differentiation is another business strategy to gain competitive advantage. This is achieved by offering something different in a product or service. The product or service will differentiation it self within the industry.

Netflix has always distinguished itself from their inception. They have always developed new technologies to further differentiation themselves from competitors that have entered the market place. This can be demonstrated by the brief history of Netflix.

Netflix was founded in 1997 to provide customers with home delivery service of movie rentals on DVDs. This grew into a subscription-based service, which allowed the customers to choose a level of service that determined how many DVDs could rent at one time. A few years later, Netflix added a streaming service to their subscription packages. They believed this was a way of reducing the costs associated with mail home delivery service. The growth of streaming media subscriptions grew so rapidly that they now offer the service to more than 53 million customers in 50 different countries. All content is streamed without commercials. Netflix provides instant streaming of movies and TV shows directly to customer’s TVs, computers, and other mobile devices. Some devices that can stream these movies and shows are gaming systems such as, Xbox, PlayStation, and Wii.  Viewing Recommendations are given based on viewing habits, as well as allowing for multiple profiles, making it possible for every family member to have their own profile. Today, Netflix does not only stream content from other producers, but is now producing their own original TV series and movies. Their latest product differentiation is they added 4K streaming to original programming and some featured films.