The Two Segments of the General Environment That Ranks Highest in Their Influence on Netflix Would Be the Technological Segment and the Demographics Segment
Choose the two (2) segments of the general environment that would rank highest in
their influence on the corporation you chose. Assess how these segments affect the
corporation you chose and the industry in which it operates.
The two segments of the general environment that ranks highest in their influence on Netflix would be the technological segment and the demographics segment.
The technological segment includes the institutions and activities involved with creating new knowledge and translating that knowledge into new outputs, products, processes and materials (Hitt, 2013). The technological segment affects Netflix because in order to keep a competitive advantage over companies such as Amazon Prime and Hulu, Netflix has to keep up with the latest technologies when it comes to online video streaming service and DVD rental industry. Netflix has to continue to study the different technologies that will create more value for their customers. For Netflix to remain as the industry leader, it must continue to dedicate a large portion of its budget to Research & Development in order to continue to create innovative product offerings to its customers.
The demographics segment is concerned with a population’s size, age, geographic distribution, ethnic mix, and income distribution (Hitt, 2013). According to the U.S Census Bureau, the five most populated countries are: China (1.3 billion), India (1.2 billion), United States (311 million), Indonesia (246 million), and Brazil (203 million). (Census.gov, 2012) It’s important to identify the larger markets because they provide tremendous opportunities for Netflix to increase its world market share. All five of the countries with the largest populations have sufficient purchasing power to be Netflix customers. Aside from the U.S., Netflix also operates in Canada and parts of Latin America.
The demographics segment is important to Netflix because it targets the mass market which includes families, children, single people, and professionals; basically Netflix is so user friendly anyone can use their products. Its target market must be comfortable with the internet and DVD player since Netflix offers an internet subscription service streaming television shows, movies, and DVD’s. The Netflix target audience is not limited by geography, but by the access to technology. This is an important factor to consider because a company has to know their intended audience that they are trying to market their products for.
Considering the five (5) forces of competition, choose the two (2) that you estimate
are the most significant for the corporation you chose. Evaluate how well the company has
addressed these two (2) forces in the recent past.