An In-Depth Look Into Skywalker's Streaming Options: Netflix vs Amazon Prime Video - Essay Sample

Introduction

Watching movies and top TV shows are part of Skywalker's hobby. Skywalker has experienced the use of Netflix through his smartphone, and he clearly understands that Amazon Prime Video has the best streaming services since it offers an excellent selection of movies, TV shows, and original programming (Csathy, 2020, p.1). However, there are plenty of other great options such as Netflix which offer competition to Amazon Prime Video. Skywalker wants to save some of the cash he has at hand, so he was in a dilemma on which company to choose. Amazon Prime Video was a worthwhile option because it was less expensive. From another perspective, Netflix offers live streaming TV programming, and it would be convenient for Skywalker because it offers monthly subscriptions, allowing an individual to unsubscribe and re-subscribe as necessary (The case of Amazon.com and Netflix.com: 4 lessons for marketers, product managers & owners | WUA!, 2019, p.2). This shows that despite Amazon Prime Video is the excellent service provider and a good recommendation system, it is facing stiff competition from other streaming companies. Nonetheless, Amazon Prime Video will have to utilize Facebook ads, particularly the Lead Gen Ads, to enable the company to gain more young consumers, hence cope with the Netflix competition. Lead Gen Ads will present an image or video ad that will entice a click.

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Who will see the ad?

The Facebook ad will target our young consumers at the age bracket of18-25 years just as Skywalker. The ad will have expanded options for online to offline targeting, meaning that our target customers in the real world can be stream on our videos. The lack of video-on-demand streaming affected Amazon Prime Video customers. This problem arose after Netflix expanded its operations to streaming media (Watson, 2019). This phenomenon changed the way people viewed TV shows, movies, and video content in general. By 2017, Amazon Prime Video had around twenty-six million subscribers in America, and it occupied the second position in the video industry.

What will be the format of the ad?

The display ad will be the primary format for our Facebook ad to reach our target audience (Miller, 2018, p.2). The fact that our target audience is a young generation, they are highly knowledgeable of the search engines, so our ad can appear all over the web. A display ad will be convenient to the company in that it offers the flexibility of allowing users to choose video, text, or image-based ads that can be placed or viewed anywhere across the Display Network. Additionally, the company will have a high assurance that the ad will reach almost 90% of the target audience.

Where will the target audience see the ad?

Display ads can be placed anywhere across the display network (Miller, 2018, p.2). Since the Amazon Prime Video will be using a Facebook ad, the ad will be placed on the social media platform, and it will obviously appear on that platform. Facebook has the freedom to choose a specific place on the page where an ad can be put so that the company can place it on the News Feed, or on the side of the page.

When will the target audience see the ad?

The company's target audience will see the ad when they are on the Facebook social media platform (Miller, 2018, p.3). However, the ad will appear on the platform for only three times a day to avoid becoming annoying or spamming the audience with the ad.so it will be important to ensure that the ad is consistent.

Why show the ad?

The ad is intended to encourage the target market to watch videos, movies, or TV shows on Amazon Prime Video when either online or offline. The company intends to acquire more customers to increase its market share demand, thus take an effective competitive edge with Netflix. This is because as the demand increases, the market expands. This increase in demand forced the streaming media companies to begin producing their original content (Chaffey, 2018, p.2). In 2017, Amazon Prime Video created twenty-three new digital original programs, which have been continuously increasing over the years. Nonetheless, Netflix has managed to maintain the top position in the industry by producing original and quality series that make it possible for consumers to watch the series immediately after release and quickly move on to watch the next original hit show (Amazon Prime Video vs. Netflix | Allconnect, 2020).

Amazon responded to Netflix competition by introducing offline streaming before the feature was offered by Netflix (Watson, 2019). This strategy aimed at reducing the cost for the customer and increase easier access to the video anywhere. Offline streaming was an innovative idea that pushed Amazon ahead of its competitors. Netflix did not offer offline streaming, but after Amazon started offering it to its consumers, Netflix also introduced it. Amazon focused on advancement and development ways to ensure that consumers are more satisfied hence capture many subscribers to the Amazon Prime membership. Statistics show that in a year, the Amazon Prime subscribers spend an average of almost nine hundred US dollars more than non-members. This enabled the company to expand internationally, thus pushing out any competition in the global market.

Amazon prime spends millions of dollars in marketing and production expenses in an attempt to compete with Netflix in producing its own original programs. In the second season of one of its initial series "The Man in the High Castle," the company spent more than one hundred million dollars in its production and marketing (Most in-demand SVoD services by demand share in the U.S. 2019 | Statista, 2020). Additionally, to ensure the production of original programs, Amazon Prime has increased its selection of TV shows and movies. Movies are the most viewed contents in Amazon Prime Video, and in 2017; around 66% of consumers were watching the recently released movies.

Amazon Prime videos are most viewed by young demographics. Around 23% of the users are in the age bracket of eighteen to twenty-nine years, and they view the content at least once per day (Most in-demand SVoD services by demand share in the U.S. 2019 | Statista, 2020). The reason for the increased viewership in Amazon's Prime video is likely due to the platform's strength. The company has gone ahead to add new features in its streaming platform, the Amazon Channels, that allow the users to view third party content such as Cinemax or Showtime. The channels also provide users with access to thousands of additional titles.

However, statistics in the first and third quarter of 2019 show that Netflix held the first position in demand with 59.9%, and the second position was Amazon Prime Video with 9.3% (Most in-demand SVoD services by demand share in the U.S. 2019 | Statista, 2020). Even though the demand share for Netflix dropped slightly between the first and third quarters of the year, Netflix platform and content still remains popular. This shows that Amazon Prime Video still has a lot of advancement to be done on its platform and content, to attain high demand share and be on the same position with Netflix.

Table 1: Figures on audience demand share for digital originals in US during 2019 Ist and 3rd quarters

Netflix Hulu DC Universe CBS All Access Amazon Prime Video Others

1st Quarter 63.1% 7.9% 5.6% 4.6% 9.7% 9.1%

3rd Quarter 59.9% 7.8% 5.1% 3.6% 9.3% 14.3%

Figure 1: A graph showing the trend in demand share in US during the 1st and 3rd quarters of 2019

Digital marketing will reshape Amazon Prime Video in the marketplace. According to the company's CEO Jeff Bezo, digital marketing will boost customer care, enable limitless inventory, and allow high margin thus lower prices (Lang, Tinder, Zimmerman, and Harrison, 2012, p.1). One of the business strategies for Amazon Prime Video is to become an online and offline retail giant by competing effectively with Netflix. While planning for digital marketing will first conduct a SWOT analysis for the organization and its environment (Zhang, Qin, Wang, and Luo, 2019, p.3). Amazon Prime Video will have to monitor the company's competitors and sector, assess the web positioning of the company and its platforms, and evaluate the social network regarding its activity, presence, influence and so on (Pineiro-Otero and Martinez-Rolan, 2016, p.46). When implementing digital marketing strategies, the company will use a Facebook ad, and the content will be mentioned.

Digital strategies will complement the business and organizational strategies of Amazon Prime Video. These digital strategies will include digitalizing the channel processes and offerings, simplifying online and offline streaming processes, creating digital media and content and investing on research and development (Lang, Tinder, Zimmerman, and Harrison, 2012, p.5). According to Elert et al. (2017, p.2), the sustainable growth of a company is based on its ability to exploit innovations in its daily activities. Pisano (2015, P.5) states that distinctive innovation types can complement the existing services and products, and this can be applied in Amazon Prime Video, where innovative technologies will design complementarities among its services.

Conclusion

Amazon Prime Video utilized the Facebook ad to reach its target customers who were young generation aged 18-25 years. The ad was placed on the Facebook social media platform in the News Feed. Amazon Prime Video faced stiff competition from Netflix after Netflix began producing streaming media. Amazon Prime, therefore, decided to offer offline steaming to cope with competition from Netflix. Using the Facebook ad would encourage the target audience to watch the videos, TV shows and movies at no cost, and in return, accelerate the market share demand of the company. Besides the Facebook ad, digital marketing strategies that have been adopted by Amazon Prime Video have enabled the company to thrive in the globally competitive marketplace.

Reference List

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Csathy, P., 2020. Amazon Prime Video: The Stealthy, Ominous Streaming Force. [online]

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Elert, N., Henrekson, M. and Stenkula, M., 2017. Institutional reform for innovation and entrepreneurship: An agenda for Europe. New York: Springer International Publishing.

Lang, S., Tinder, L., Zimmerman, J. and Harrison, J.S., 2012. Amazon. com: Offering Everything from A to Z.

Miller, J., 2018. The 5 W's Of Digital Marketing. [online] Randall-Reilly. Available at <https://www.randallreilly.com/the-5-ws-of-digital-marketing/> [Accessed 28 April 2020].

Pineiro-Otero, T. and Martinez-Rolan, X., 2016. Understanding digital marketing-Basics and actions. In MBA (pp. 37-74). Springer, Cham.

Pisano, G.P., 2015. You need an innovation strategy. Harvard Business Review, 93(6), pp.44-54.

Statista. 2020. Most In-Demand Svod Services By Demand Share In The U.S. 2019 | Statista.

[online] Available at: <https://www.statista.com/statistics/825242/most-in-demand-streaming-services-usa-share/> [Accessed 27 April 2020].

Watson, A., 2019. Topic: Amazon Prime Video- Statistics & Facts....