Blockbuster stores shuttered their doors but Netflix is still growing. Both companies participated in the video rental business. Netflix evaluated the lifestyle needs of video customers, understanding that time, family, and work obligations called for more convenient methods to receive video entertainment. Netflix embraced the opportunity to stream videos directly to customers and create their own content. The company also managed to keep customer costs down, by passing along the savings it realized in labor. Blockbuster did not pay enough attention to competitor movements, permitting Netflix to quickly capture video market share. Which external environment probably had the least effect on Netflix's success?
A) Social environment
B) Competitive environment
C) Economic and legal environment
D) Technological environment

Question

Quizplus · Accepted Answer

Netflix embraced new opportunities in technology to stream online. It also saw opportunities in the social environment. With single- and dual-income families pressed for time, customers are seeking added conveniences. Netflix differentiates its product, positioning itself as friendlier and cheaper. Blockbuster was very slow to react to competitive pressures. Although customers enjoyed the cheaper prices, the technological environment made it cheaper for Netflix to keep costs down and pass along savings to the customer. The economic downturn had little effect on this situation; and the firms operated within the legal limits of the law.

Blockbuster Stores Shuttered Their Doors but Netflix Is Still Growing