The Happy Underdog: Netflix!

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Want to watch the latest episodes of House of Cards? OR Narcos? How about Arrested Development? Remember that hunk in Arrow? Craving for some popcorn in the comfort of your warm bed with a glass of wine and a rerun of your favorite show? Well! Netflix to the rescue!

There was a time when online streaming of your favorite TV shows and movies was a dream! Netflix Inc. made it a reality.

Netflix Inc. is an American multinational entertainment company that was founded in 1997 by CEO Reed Hastings and his partner Mark Rendall specializing in providing video on demand (VoD) and streaming media both physically and online as well. Since its inception, it has expanded onto television production and online distribution.

In 2007, Netflix introduced online streaming in the form of unlimited streaming for a low monthly price. In 2013, Netflix introduced its first original series- “House of Cards” and “Orange is the New Black” via “Netflix Original” content which is available now through the online library of television series and films.

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It offers customized viewing based on previously watched shows and movies.

In the current date, Netflix is seen as the world’s foremost internet television network with more than 83 million subscribers worldwide!



Netflix is the preferred means of watching TV shows, movies and select documentaries. Consumers are able to watch content through a variety of electronics like gaming consoles, tablets, smart phones, internet TVs, computers/laptops at home, while commuting and basically anywhere with a WIFI connection.




CEO Reed Hastings takes care of the customer relationship management and loyalty by  taking customer phone calls personally which ties in a strong desire to fulfill consumer interest.

Over the years, Netflix has realized the demand for an online streaming service, thus recognizing the need for an attitude change in consumers and formation of simple beliefs in order to influence the viewers to try Netflix. Subsequently,Netflix started asking the following questions and shifted their focus on determining consumer behavior-

How are consumers evaluating their service?

The main marketing strategy behind Netflix was to change consumer’s perceptions of Netflix and offer those consumers something extremely basic, while at the same retain all the existing customers.


Iacobucci (2013) describes how family members and friendship groups can influence a consumer’s behavior. He also describes cultural upbringing, assumptions and values as a determinant of how a consumer chooses what to watch. Netflix discovered that consumers prefer products which are convenient to use and good for sharing amongst their friends and family. It deduced that choosing a paid service is based on the content that is offered,the pricing and the ease of use.

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Consumers want content which is updated regularly and consumers are open to competitive pricing if a service offers what they are looking for.

Netflix successfully utilized the wheel of consumer analysis and deduced why people chose Video on demand products and preferred online streaming over other modes of


Wheel of Consumer Analysis

entertainment. The basic reasons for consumers preferring Netflix over other modes of entertainment is the ease of use, diversity of content, accessibility on multiple devices, good for sharing,  popularity and the freedom to choose monthly paid subscriptions. Video on demand can be defined as a private luxury seen by consumers. Consumers frequently friends, family and colleagues are important informal reference groups because they are trusted and have similar interests. Netflix uses aspirational reference groups wherein a celebrity endorses a show such as Ricky Gervais and Kevin Spacey.


NETFLIX’S approach to Attitude Formation and Change?

Netflix has been identified as a low involvement product as it has no negative effects and implicates low cognition involvement for subscription.


Maslow (1970) has identified five areas of needs that are experienced by most human beings. Starting with physiological needs, it progresses to safety and security, belongingness needs with self-esteem and self-actualization at the top. He demonstrated that the decision making processes of consumers are motivated by any of the five levels of the hierarchy.


Based on this model, Netflix’s ability to efficiently appeal to one of these motivational drivers is a chief contributing factor of Netflix’s success. Netflix appeals to needs of belongingness as by sharing content and spending time with loved ones and friends, it enhances the social needs thereby creating more levels of happiness and contentment. By its very nature, Netflix also appeals to needs of the ego (or esteem needs) and self-actualization needs within Maslow’s hierarchy of needs through knowledge and understanding due to the regularly updated content.


As has been described by Iacobucci (2013) , “perception is the process via which we select, organize and interpret information inputs to create a sensible and a meaningful picture of the world around us.”wuzyVTTX

Netflix has incorporated the theories around sensory perception successfully.
The use of a bright red color has been proven to have a very positive effect on consumers’ emotions. Netflix successfully gained brand familiarity and a positive feeling with repeated exposure of the red color and the letter “N”.  Netflix’s new icon however, works because of its straightforwardness and ability for consumers to link the brand with the word Netflix right away, thus relating to perpetual fluency- the ease with which information is processed by the brain.

For some consumers, Netflix is synonymous with convenience and ease of use. Netflix quickly grasped the power of the consumer and spent on it generously to become of the biggest underdog success stories in recent years.

Time to go back to your favorite Netflix show, perhaps?


Broniarczyk, SM & Griffin, J 2014, ‘Decision difficulty in the age of consumer empowerment’, Journal of Consumer Psychology, Forthcoming.

Harvard Business Review 2015, The Science of Sensory Marketing, Harvard Business Review, retrieved 29 July 2016, <;.

Iacobucci, D 2013, Mm4, Cengage Learning.

Kotler, P 2001, Marketing Management, 10, Pearson Education Canada.

Maslow, AH, Frager, R, Fadiman, J, McReynolds, C & Cox, R 1970, Motivation and personality, vol. 2, Harper & Row New York.

Rao N 2015, Management Theory Review, Management Theory Review, retrieved 27 July 2016, <>.

Sajonas F 2016, Netflix Goes for a Bit of Branding Flair With a New Logo, Hypebeast, retrieved 28 July 2016, <>.

Solomon, M, Russell-Bennett, R & Previte, J 2012, Consumer behaviour, Pearson Higher Education AU.

Posted by- Aditi Sharma

Student ID-215001193

Username- aditisharma03


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