Netflix is a company that enables its members to watch movies, TV shows, films, and even documentaries. The company has been offering quality services to its customers due to its proper strategies of meeting the customers' niche. The company can still improve revenue generation if it invests in merchandising opportunities. Merchandising is an act in which a company promotes its goods and services by determining their quantities, setting prices for the goods, developing display designs, and creating a market for the goods, and initiating discounts on its goods or services. I would recommend Netflix to engage in merchandising activity as it would be an important opportunity in stimulating the customer’s interest in the company’s services and entice them to purchase. Investing in merchandising creates an immediate effect on the customers' shopping experience and makes the retailing develop their stores' effective designs (Jakhar et al., 2020). The basic features of merchandising are designing products in a way that is visible to the customers creating more attention to the product. It will help in improving the customers' perceptions of the products or services. Branding is another feature that makes the product or service distinguishable from others. A brand's design, tern, sign, and symbol are used to identify the firm's product or service.
I would recommend the company to merchandize its services as an opportunity to increase the customer's interest. Also, the creation of digital technology is playing a vital role in the evolution of merchandising (Horvath & Gyenge, 2018). It is the main force that is currently dictating how the consumers choose between the sources of entertainment and improving their prevalence on how they base their purchase decision. Netflix had a successful experiment after merchandizing Stranger Things. Merchandizing the show helped Netflix increase its subscribers and also helped the company make a profit of $665 million, while its stock rose by 8% (Lee, 2019). Other companies such as Disney are merchandising their products through digital technology to sell their products like videogames. Investing in the merchandising opportunity would require Netflix to invest in high cost towards the project towards the following year. Developing the products' brands, designs, and advertisements would take a heavy budget for the company. The opportunity would require a heavy budget due to the primary and home entertainment incomes and high shareholder presumptions due to the merchandising income. Taking the example of Stranger Things , Netflix paid $6 million per episode which increase to $8 million in the second season (Neiger, 2019). I believe the company should invest in merchandising to reach more customers globally.
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References
Horvath, A., & Gyenge, B. (2018). Movie Merchandising and its Consumer Perception. International Conference 2018 , (pp. 637-643).
Jakhar, R., Verma, D., Rathore, A. P., & Kumar, K. (2020). Prioritization of dimensions of visual merchandising for apparel retailers using FAHP. Benchmarking: An International Journal, 27 (10), 2759-2784. https://www-emerald-com.ezproxy.snhu.edu/insight/content/doi/10.1108/BIJ-11-2019-0497/full/html
Lee, E. (2019). Stranger Things helps Netflix increase subscribers. The New York Times. https://www.nytimes.com/2019/10/16/business/media/netflix-q3-earnings.html#:~:text=The%20company%20also%20reported%20a,in%20after%2Dhours%20trading%20Wednesday.
Neiger, C. (2019). How much does Netflix need Stranger Things? NASDAQ. https://www.nasdaq.com/articles/how-much-does-netflix-need-stranger-things-2019-11-27
