In the context of rapid growth of technology within companies and the changing consumer preference, competitive advantage plays a key role in ensuring that the future of a company is safeguarded. On the basis of competitive advantage, Netflix has continuously prepared to capture the value of its smart software. The recommendation software, for instance, gives Netflix a sustainable competitive advantage provided no competitor develops improved software. The issue of distribution is also of big value to the customers.
Competitive advantage measures the appropriateness of the company’s activities. It is a factor that distinguishes a business from others with similar output. It is also a factor that gives customers the likeliness of choosing one product over the other. I believe that a competitive advantage can be possible if the objectives and scope of the business are aligned with the strategies of the business. To gain a competitive advantage there is a need to determine what will be done differently or better than the competitors to ensure that the business achieves its objectives.
I think that Netflix might have a long-term competitive advantage in that, it has various supporting factors. Among them, is the fact that it maintains a significant lead in distribution, it has an iconic brand when it comes to distributing videos, and it has an unrivaled portfolio of subscription on the basis of digital content rights. However, despite the enormous possibility of having a sustainable competitive advantage, Netflix’s infrastructure is not formidable enough to serve as a barrier to the entry of other potential competitors in the market. Netflix can only maintain its competitive advantage if it spends more on original programming.