Question

My topic is Netflix

II. Explore the supply and demand conditions for your firm’s product.

a) Evaluate trends in demand over time and explain their impact on the industry and the firm. You should consider including annual sales figures for the product your firm sells.

b) Analyze information and data related to the demand and supply for your firm’s product(s) to support your recommendation for the firm’s actions. Remember to include a graphical representation of the data and information used in your analysis.

III. Examine the price elasticity of demand for the product(s) your firm sells.

a) Analyze the available data and information, such as pricing and the availability of substitutes, and justify how you determine the price elasticity of demand for your firm’s product.

b) Explain the factors that affect consumer responsiveness to price changes for this product, using the concept of price elasticity of demand as your guide.

c) Assess how the price elasticity of demand impacts the firm’s pricing decisions and revenue growth

References:

DATAMONITOR: Netflix, Inc. (2010). Netflix Inc. SWOT Analysis, 1–9

Lev-Ram, M. (2019). ONCE UPON A TIME AT NETFLIX. (cover story). Fortune, 180(4), 74–83.

Nobody Knows What Television Is Anymore. (2019). Reason, 51(7), 58.

Answer 1

Factors affecting demand of netflix are:-

a) incresed use of complementary goods like 4G technology

b) Less time to go to cinema for 3 hours movie

c) youth searching for new avenues of entertainment

Factors affecting supply

a) improved technology leading to reduced cost of production

b) easy and cheap mode of production

c) content based material so less star centric

Preice elasticity of demand will be very high as small decrease in Price cause huge increase in demand as subscription price goes slightly down demand soars high

Availability of substitutes cause price elasticity of demand to highly elastic as small increase in price of one firm cause huge shift in demand in favour of rival firms like ullu is cheaper so it grabs more customer

Price elasticity being high so firm will have less control to raise price as customers will shift to rival firms and small decrease in price cause great increase in demand and more revenue