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DATCB/565: Netflix's Global Expansion

Name

Institutional Affiliation

Course

Date
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PART 1

Summary on Netflix's Expansion

The success of Netflix's expansion has been attributed to its adoption of a three-step

gradual process of globalization. In the inception of the expansion, the focus was on

countries that exhibited significant resemblance to the domestic market. The organization

will leverage its prior experience and established local partnerships to penetrate other

dissimilar nations successfully. Ultimately, it would venture into uncharted territories due

to the advantageous economic factors associated with increased production and efficiency.

The second approach entailed implementing a mutually beneficial collaboration with

various stakeholders in the nations where it is pursuing expansion.

Big data and analytics investment was crucial for the company's expansion into non-

traditional markets. Big data helps understand customer behavior and identify service gaps.

Since Streaming is a data business, Netflix invested in big data to create new income,

marketing, and improve customer service. Streaming thus Produces big numbers that

require analysis. Netflix uses customer data to understand users better because millions of

diverse data sets are stored.

Data analytics helped Netflix expand faster. Netflix expanded exponentially into

multiple countries. Other companies need help to replicate our globalization strategy due to

its complexity. For instance, WebVan failed to replicate Netflix's success. WebVan was an

affordable online grocery with a wide selection and quality goods that offered delivery.

WebVan needed to expand more quickly in an emerging market. Despite being a great idea,

businesses shut down due to a lack of market fit (Relan, 2013). WebVan was ahead of its

time but needed help to expand like Netflix. Peter Relan warns against rapid scaling using
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Webvan as an example in Techcrunch. WebVan was pressured to expand rapidly after

raising $800M. Expansion crushed by 2000 crash. WebVan had to sell assets due to a lack

of funding.

In the dot-com era, companies rushed to proliferate. WebVan's rapid expansion

drained its capital and led to its downfall, unlike the current emphasis on minimum viable

products. Like WebVan, other companies failed by not understanding new markets,

legal/bureaucratic challenges, rigid reliance on past success, and not utilizing advantages

like Netflix did with customer data analytics.

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Part 2

Data Analysis and Business Analytics

We did two tests in this study. There are two scenarios where resources should be allocated:

1. If TiQ is below the market average, more resources are required. The second test

evaluated the new protocol's superiority to the traditional one. For both tests, we perform

four necessary steps. These are:

1) Hypotheses determination,

2) significance level determination,

3) critic Z-value determination,

4) conclusion.

To test if a company's TiQ is lower than the industry norm of 2.5 mins, a hypothesis test

with α=0.05 can be done.

H0: Avg TiQ ≥ 150s, Ha: Avg TiQ < 150s. The hypothesis can be evaluated by collecting

TiQ data and performing a one-sample t-test.

For the first case, the steps are:

α =0.05

µ=150

χ= 160.9

σ= 159.9

n=1674

Degree of freedom=n−1=1674−1=1673
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H0: µ=150

Ha: µ>150

Avg QitT – AvG H 0

( )
1) Test statistics Z= Dev
sqr ( N )

160.89 – 150
Z= 159.88
0.5
1674

Z= 2.78

For this test statistic and a degree of freedom 1673, the p−value is read off from the

distribution tables

p-value=0.003

We reject the null hypothesis since the p-value is lesser than the significance level.

2) Conclusion:

The test concludes that the company's TiQ is higher than the industry standard. The P-

value is 0.003, so the null hypothesis is rejected. Given the present scenario, additional

resources to enhance TiQ may be optional as the company has already achieved or

outperformed the industry standards. So, we should allocate fewer resources to improve
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de average QiT (Albright & Winston, 2022). The company's TiQ is higher than the

industry average. TiQ of the company outperforms the industry benchmark, so there is

no need for improvement. It is optional to allocate more resources for TiQ improvement

now. Higher TiQ is advantageous in certain situations, and It suggests the company

offers excellent services with attention to detail. It is essential to monitor TiQ

performance consistently. Adapt to changing standards and expectations to stay

competitive in the market. Feedback from customers improves service quality. The

company should pride itself on TiQ and monitor trends and customer needs for

continued success in timely services.

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The second analysis checks if PE has enhanced ST compared to ST.

Avg ST PE= 149.28

Dev ST PE = 185.78

Var ST PE = 34,515

N = 853

Avg ST PT = 212.16

Dev PT = 190.46

Var ST PT = 36,276

N = 821

Avg ST PT
1) H0: Avg ST PE = =0
Avg ST PE – Avg ST PT

2)

Avg ST PT
3) H1: Avg ST PE < <0
Avg ST PE – Avg ST PT

4)

5) I will reject H0 if Z > 1.64 or Z < -1.64

( Avg ST PE – Avg ST PT ) – 0

(( )( ))
0.5
Z= Var PE Var PT
+
n1 n2
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149.28 – 185.78

(
Z= 34515 36276 0.5
853
+
821 )

Z = -6.83

6) Conclusion

At a confidence level of 95%, the null hypothesis (H0) can be rejected.

Implementing the new protocol has resulted in notable enhancements in service

delivery timing (Albright et al., 2012). Drawing upon the furnished data, a

hypothesis test was performed to establish that the mean Service Time (ST) under

protocol PE is inferior to that of protocol PT. The null hypothesis (H0) posits

equivalence in mean ST measurements between the two protocols, whereas the

alternative hypothesis (Ha) postulates that the mean ST associated with protocol PE

is lower. PE protocol showed a significantly lower average ST than PT protocol

indicating a successful reduction in service time. The hypothesis test proves that

protocol PE effectively reduces service time enhances efficiency, and improves

customer satisfaction. Based on They can optimize the PE protocol for consistent

service delivery. Based on the conclusion, continuous monitoring is crucial for

effectiveness and improvement.

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References

Albright, S. C., & Winston, W. L. (2022). Business analytics: Data Analysis and decision

making. Cengage.

Albright, S. C., Winston, W. L., Zappe, C. J., & Broadie, M. N. (2012). Data Analysis and

Decision Making: Selected Chapters. Nelson Education.

Relan, P. (2013, September 30). Where webvan failed and how Home Delivery 2.0 could

succeed. TechCrunch. https://techcrunch.com/2013/09/27/why-webvan-failed-and-

how-home-delivery-2-0-is-addressing-the-problems/