A Study on Factors Affecting Subscription Rates of Netflix in India: An Empirical Approach

Vol 18 , Issue 1 , January - June 2017 | Pages: 83-100 | Research Paper

https://doi.org/10.51768/dbr.v18i1.181201717

Published Online: January 07, 2017

Author Details ( * ) denotes Corresponding author

1. * Virender Khanna, Professor, Head of Department, School of Business and Entrepreneurship, Noida, Uttar Pradesh, India (virkhanna@dspsr.in)

Purpose: Netflix entered India and 129 more countries on January 6, 2016, with the target to increase its customer base. Through this study we want to understand the reasons behind the low subscription rate and to recommend ways to ensure better growth. Through the literature survey, we have identified various factors affecting low subscription rates of Netflix in India. After we have identified the factors necessary to take into consideration, we have developed a problem statement. We developed a research design which is applied and exploratory in principle.

Methodology: The demographic consumer research has showed us many qualitative factors which could possibly affect the subscription rates. We also developed a quantitative model through which we took 11 independent variables, performed factor analysis, and formed 4 factors on which we did multiple regressions to identify the explanatory power of factors on subscription rates.

Findings: Low subscription rates in India where the competitors like Hotstar, Youtube, Voot are providing the digital content for free. It would be feasible for Netflix to lower down the rates for the middle class consumers who have a willingness to pay an amount till Rs. 200/- per month which could certainly increase the subscription rates.

Research Implications: We have presented with the managerial implications for our project which have identified pricing, lack of regional content, payment options available as the major factors contributing to low subscription rates of Netflix rates in India.

Practical Implications: Netflix, after its launch in India on January 6, 2016 was a craze amongst the people but after the pricing launch and the non-availability of bollywood films on the app, people did not subscribe to the service.

Originality/Value: This is very new concept and no such kind of research is done in India, that makes this research very valuable.

Keywords

Netflix, Subscription Rate, Indian Context.

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