1.) Two parties: Netflix / video rental consumer; Netflix has movies / consumer is willing to pay for subscription membership; Communication established through email and distribution established through USPS; Netflix can cancel membership and not send out any more videos / consumer can choose a different source for movie rentals; Subscriber pays monthly fee and chooses movies / Netflix send out movies / subscriber returns movies / repeat.
2.) Netfliz subscribes to the Market Orientation philosophy. According to the Netflix founder, the company was formed as a result of his personal dissatisfaction as a video rental consumer. Netflix focuses on the wants of the consumer. For example: no late fees; user friendly ordering system; fast delivery and return service. Also, they have a highly advanced integrated ordering/return order system. Order history, pending requests, reviews and recommendations are all linked. A bar code allows Netflix to immediately process pending orders as soon as returned items are received at the nearest warehouse (generally 1 day away from consumers). Long term goal concerns are addressed by the owner. He views diversity of products as the next step. This would include offering used DVD's and Internet downloads for purchase.
3.) Netflix is concerned with keeping their existing customers and in improving services to them. They actively listen to customer feedback and have implemented many new features to their ordering system based on this feedback. For example, they have allowed multiple "wish lists" on singular accounts. This caters to the needs of many of their customers who have families or multiple people sharing one location. Additionally, Netflix has highly customer focused service representatives, with 20% of these representatives authorized to make direct call-backs to customers who have entered a complaint. The main focus of the call is to determine how the problem could have been prevented, not just solved.
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