Netflix

I have never used Netflix and haven't been to a Blockbuster in years, so reading this case was truly a learning experience for me. What I knew about Netflix I had heard from a few very loyal users: that there were no late fees-you could keep your DVD for as long as you liked, you could keep up to 3 at one time, and you created a queue so that when you sent back a movie, the next one in your queue was sent automatically. I assumed Netflix catered to those looking to see new releases, and had no idea that Netflix had a reputation of being the "highest-quality source of independent films."
I was impressed by a few key actions that Netflix took that enabled them to be successful:
1) creating a proprietary algorithm that took into account the user's survey results to make appropriate movie recommendations, yet at the same time screening the results to prevent recommending a title that was out of stock.
2) Establishing a revenue-sharing agreements with major movie studios
3) Partnering with the USPS, often considered a money-loser, to put special processes into place that allowed Netflix to reach "90% of subscribers within one business day".
This upstream thinking was tantamount to Netflix's success.