Netflix is Under Siege - Are You?
One of the greatest business #success stories over the last decade or so is Netflix. They found a way to adjust their business model to stay relevant and thrive in their industry multiple times in face of different competition, from Blockbuster and RedBox in their early years, to HBO, Hulu and Amazon today. But in 2019, they’ll face, potentially, their greatest challenge - Disney. And you, the business #owner, can learn a valuable lesson in all this.
Say Hello to Their Biggest Competitor
Disney is planning to launch a streaming platform of its own at some point in late 2019, and given all the properties Disney owns (Pixar, Star Wars, Marvel, ABC, A&E, ESPN and more), without spending a single extra cent on new content, they could already have Netflix beaten. A Forbes contributor certainly seems to agree - as early as mid-2018, they’ve been suggesting that Netflix’s stock will start to drop as impending doom in the form of Disney looms over its head in 2019.
And, truthfully, Netflix stock has started to decline following a summer peak. It’s reasonable to assume that once Disney’s streaming service is released, a little while down the line the #market will stabilize and both companies will find their footing in separate lanes. But, some suggest that Netflix is reaching a logical endpoint given its #business model.
Can They Really Compete?
Netflix’s success over the past several years has been based on original content creation. That’s how they have remained competitive against the current crop of streaming services. Amazon and Hulu have continued to gain steam, but Netflix has been able to keep them at bay. But, even without Disney, Netflix might be in a bit of trouble keeping pace.
According to reports, they’ve been putting themselves into debt by funding the creation of original #content - cutting into an already narrow profit margin. With or without Disney, they wouldn’t be able to last forever without something giving. With Disney and their incredible amount of existing content, plus pockets deep enough to outspend nearly anyone for anything - Netflix is going to face a moment of reckoning.
So What Does This Mean For You?
Aside from the fact that you might end up changing streaming services for your family, Netflix is following a pattern for disruptive businesses to a T. Through innovation, they created an industry and established a market that did not exist before. Eventually, though, #competition arose in the market and further innovation occurred that left the originator of that very industry in the dust. The question for you, as an entrepreneur, is how do you avoid a similar fate?
What Netflix might face over the next few years would be the same fate met by even larger companies, like Kodak. The reality is, no matter how confident you are in your products and services, and no matter how loyal your client-base/customer-base might be, you always need to make sure you’re staying ahead of the competition and willing to adapt to an everchanging business climate.
Whether you’ve been in #business for a few weeks or for decade, make sure you take time to revisit and review your goals, objectives, and the vision of your business. Set times each year to make sure you’re keeping track of where you are and where you want to be, as well as where you exist in your industry.
Just remember, that if a company so ubiquitous and culturally relevant like Netflix has to stay on top if its game, then so do you!