10 Business Lessons to Learn From Netflix Co-Founder Marc Randolph Learn valuable business lessons from the entrepreneur with the billion-dollar idea.

By Christian Nwachukwu

entrepreneur daily

Opinions expressed by Entrepreneur contributors are their own.

If you are old enough to remember the days of going to Blockbuster to find a new movie or watch an old favorite for the 100th time, you might have thought "Those were the good old days." In reality, they were, but things dramatically changed when Netflix came onto the scene.

On August 29, 1997, Netflix was started by Reed Hastings and Marc Randolph as an online DVD rental service, but it has now become the world's largest online streaming platform.

What can we learn from Netflix founder Mark Randolph? Thanks to savvy business decisions by Randolph and his co-founder, Netflix is now worth billions of dollars. So, let's explore Randolph and the 10 best business lessons we can learn from his journey to success.

1. Staying ahead of new competitors

While Netflix was the first of its kind, competitors have flooded the market over the years. Amazon, Disney, TV networks and many more companies offer successful streaming networks. In addition, Netflix's business model continues to change with the times. It started as a DVD rental company, then offered viewers subscription services, and by 2007, it was rebranded into an online streaming service.

Related: The Crazy Numbers Behind Netflix's 20 Years of Success

2. Setting trends

Trends change all the time, and to stay relevant, companies need to stay on top of their game. Randolph and Netflix started the concept of "binge-watching," so their audience didn't have to wait each week to see their favorite show.

3. Become a disruptor

You need to become a disruptor and make the competition uncomfortable if you want to succeed. For example, Randolph knew that they could disrupt Blockbuster's business by ditching videos and going straight to DVD rentals.

"But the biggest reason we had confidence in our future is that we planned to disrupt their business by doing something they couldn't do - or at least would be unwilling to do."

- Marc Randolph

Related: Netflix Co-Founder: Here's How to Become a Disruptor

4. Seizing opportunities

Randolph saw an opportunity to expand their business from not only providing subscription streaming services but also by offering exclusivity of in-house productions. As a result, the company created hit shows such as Orange Is the New Black, The Umbrella Academy and You, which can only be found on Netflix.

5. Consumer experience

The streaming portal was designed to personalize the user's experience. It tracks the consumer's behavior, recommends movies and shows according to their search and watch history and saves the user's progress to improve their experience the next time they use the platform.

6. Pricing

Randolph and Hastings offered consumers a monthly flat-rate fee to watch unlimited DVDs to compete further with Blockbuster. Their stance on the flat-rate model has remained the same since it was introduced in 1997, except it is now a subscription-based service. While prices have increased over the years, consumers are still well aware of and committed to Netflix's quality shows and binge-watching opportunities.

7. Expansion

Another incredible way Randolph and his team took Netflix to new heights was by going global. They didn't just offer Netflix to the global market. Instead, they researched each country's regulations, technical requirements, politics, culture and consumer preferences to ensure the launch's success. As a result, Netflix can now be streamed in 190 countries worldwide.

Related: 3 Tricks the Cofounder of Netflix Uses to Make Hard Decisions Easier

8. Data-driven platform

In 2013, Netflix released its first critically acclaimed original show, House of Cards. But why did it choose this show to spend millions on creating? Netflix already knew what the consumer wanted through data collected from the market. Initially, it used a simple rating system followed by studying consumer preferences to ensure they got it right.

9. Changing to the times

Randolph and Hastings saw a huge opportunity in the increasing popularity of smart TVs, so they integrated themselves on LCD TVs to expand the audience's accessibility to the platform. As a result, families across the United States used Netflix as their primary source of television entertainment. Netflix knew how to time its streaming site according to the current economic climate. When it shifted to streaming in 2007 and 2008, the country was experiencing a recession, and Netflix provided affordable home entertainment.

10. Always be evolving

Netflix started in a market that didn't even know it needed a change. Randolph and Hastings developed Netflix to make DVD rentals convenient for consumers with no extra fees. Consumers didn't have to go to video rental shops, home entertainment was simplified and they completely changed the game. Netflix has continuously adjusted its business model to stay ahead of the game and set trends.

Related: How Success Happened for Netflix Co-Founder Marc Randolph

Christian Nwachukwu

Founder TalkCounsel

Christian Nwachukwu is an attorney with a knack for entrepreneurship. His experience includes starting his solo-law firm at 25 and bootstrapping TalkCounsel. TalkCounsel is a digital workspace that enables businesses and individuals to find, hire and collaborate with attorneys remotely.

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Editor's Pick

Related Topics

Devices

Get a 15-inch MacBook Pro for Less Than $375

Save on this refurbished MacBook Pro for a limited time.

Business Ideas

55 Small Business Ideas to Start in 2024

We put together a list of the best, most profitable small business ideas for entrepreneurs to pursue in 2024.

Business Solutions

Stay Organized with This Task Management Tool, on Sale for $30

A Study Planr Pro subscription is just $30 for life.

Thought Leaders

10 Simple, Productive Activities You Can Do When You Aren't Motivated to Work

Quick note: This article is birthed out of the urge to do something productive when I am not in a working mood. It can also inspire you on simple yet productive things to do when you're not motivated to work.

Business News

Here Are 3 Strategies Startup Founders Can Use to Approach High-Impact Disputes

The $7 billion "buy now, pay later" startup Klarna recently faced a public board spat. Here are three strategies to approach conflict within a business.

Data & Recovery

Get 2TB of Cloud Storage with PhotoSphere for Just $280 for a Limited Time

Easily store and access photos, videos, and other files spread across your work devices.