Contemporary competitive strategies of international companies

FBA (Fulfillment by Amazon) method is one of the options for third-party sellers - the store keeps the goods in Amazon warehouses and the infrastructure of the platform itself is responsible for their delivery. Goods of this category dominate the search and catalog of Amazon. The Amazon supply is very attractive for the retailer, since storage and handling services, as well as delivery from Amazon's warehouses to the customer and transfer of goods between warehouses, are much cheaper due to economies of scale and process efficiency. The buying process is also extremely advantageous for the customer, the price offer is one of the best on the market, and in combination with the logistical efficiency of the online retailer's offers are optimal (Khan, Amazon's antitrust paradox, 2016).

Using this aspects as an example, it is possible to trace the application of the resource approach in the company - the created chain of logistics centers is a strong competitive advantage, which is difficult to copy due to high costs, and it forms a unique advantage of Amazon in organizing business processes.

3. Analysis of the company's interaction with external market players.

Cobranding

Effective partnerships can often be a good competitive aspect of a strategy. Amazon Rewards Visa Signature Card is exactly this solution; Amazon's cooperation with JPMorgan Chase has become a real competitive advantage. The credit card of the company gives owners several options: a cash-back for purchases on Amazon, free annual service, free insurance for car rental around the world, traveler's insurance with luggage loss and delay coverage, concierge service (Chase, 2020). This approach increases the attractiveness of the company for customers, and possession of the card, as well as a paid subscription to Prime, increases customer loyalty - people have reason to start searching for goods exactly on the Amazon site, and the privileges granted will form the most favorable conditions of purchase on the market.

Figure 3 Share of third-party sellers on Amazon

Assortment

Around 60% of Amazon's sales in recent years have been generated by third-party sellers for whom the company acts as a marketplace. Mainly it is small and medium business. The company provides the opportunity to do business with minimal investment while ensuring storage and shipment of goods. Anyone has the opportunity to become a third-party seller, and it is not necessary to have citizenship of the country in which the company operates, or even live there. The company has created attractive working conditions for small and medium businesses. In 1999, its share was only 3% - almost the entire turnover was formed by Amazon. In monetary terms, the company's sales in the U.S. have increased from $1.6 billion to $ 117 billion over 19 years. However, during the same period, sales of independent sellers on Amazon have increased from $ 0.1 billion to $160 billion. That means that a decisive contribution to the dynamics of the company's growth is made by representatives of outside business, about 300 thousand companies and entrepreneurs who actively compete with Amazon and among themselves, creating the best supply in terms of price and range (Keyes, 2019).

Source: Amazon, 2019

4. Analysis of the company's exposure to competitors.

Acquisitions

Amazon often takes over companies whose activities are valuable and can lead to a competitive advantage. Besides, the company's practice is to put pressure on its main competitor to eventually acquire a larger market share.

An example of removing competitors is the case of Amazon and Quidsi. In 2008, Quidsi was one of the fastest-growing e-commerce companies in the world and specialized in children's products. Amazon expressed interest in acquiring Quidsi in 2009, but the company's founders declined the Amazon offer. Shortly after Quidsi abandoned the merger, Amazon reduced prices for children's products to 30%. Quidsi leaders saw that Amazon price bots - software that closely tracks other companies' prices and corrects Amazon to them - were tracking the company's website and immediately reducing Amazon prices in response to Quidsi's changes.

In September 2010, Amazon released Amazon Mom, a new service that offers annual free two-day delivery of Prime (which usually costs $79 per year). Customers could also receive an additional 30% discount on diapers by signing up for monthly deliveries under a service known as "Subscription and Savings". Finally, prices below the cost of Amazon harmed Quidsi's growth. Investors, meanwhile, were afraid to invest additional money in Quidsi given the struggle imposed by Amazon. In order not to lose the achieved success, Quidsi owners started negotiations with Walmart on the potential sale of the business. At that moment, Amazon intervened and made an aggressive counteroffer. Through the purchase of Quidsi, Amazon eliminated a leading competitor in the online sale of children's products. Amazon achieved this by reducing prices and incurring losses, but by completing the purchase of a key competitor - and seemingly losing hundreds of millions of dollars - the online retailer raised prices.

In addition to acquisitions to eliminate competitors, the company also buys businesses whose technology can improve their competitive advantage. Thus, in 2012, Amazon bought the company Kiva Systems, which was engaged in the production of warehouse robots. This solution reduced operating costs per warehouse by about 20 percent (Khan, 2016). In addition to reducing costs, this solution allows you to speed up the work in the company's fulfillment centers. The M&A examples described above on the part of Amazon form the company's market leadership and contribute to improving processes within the company.

Conclusion

Amazon's strategy can be defined as global since the company's operations in all its markets of operation have the same characteristics. Factors and actions described in this paragraph have shaped Amazon's competitive strategy and created strong business advantages. Such solutions have allowed the company to achieve success in one of the most highly competitive markets in the world - the U.S. and to occupy 47% of the e-commerce retail market. These same solutions Amazon distributes to the markets of other countries where it starts to operate, and their effectiveness is confirmed by the company's continuous growth. With the above-mentioned components of the strategy, the company managed to achieve success along with the development of the e-retail segment and to form leadership in the red ocean of competition.

Wal-Mart competitive strategy

1. Company overview: characteristics and peculiarities of the company's position.

Currently, Walmart is the largest retailer in the U.S., which, however, successfully operates in 28 countries. At the moment, Walmart's strategy in offline trading, which remains the company's core business, can be defined as global, since the company operates worldwide through an international office, using the same strategy in all markets. It should be noted that this approach has not always been successful, for instance, the company was forced to curtail its business in the German market due to inconsistency of the company's approach with the peculiarities of the local market. According to the company reports, it has an extensive fleet of stores that are nearby (10 miles) to 90 percent of the U.S. population, which is a powerful weapon. Walmart's revenue is more than double Amazon's, but Amazon's growth rate is faster than Walmart's. The reason for this is the upward trend in the share of e-commerce amid stagnation in offline retailing (DigitalCommerce360, 2020). This situation is a threat even for leading retailers.

Figure 4 Walmart ecommerce sales in US

Source: eMarketer, Feb 2019

Based on changes in the market, Walmart has started to develop the e-commerce market in recent years. The battle against Amazon for leadership in retail sales, which has been ongoing for several years, is based on several components and goes beyond retail. Tough competition is driving dramatic changes in Walmart's strategy, one of the world's largest corporations, the company has to change to make progress in markets that may become core in the coming years. Innovations and technologies are new directions that are actively developing at Walmart (Casadesus-Masanell & Elterman, 2019).

2. Analysis of resource management in the company's strategy.

Logistics

The Walmart food business, representing more than half of the store's sales, is a developed area and creates a competitive advantage for the company to develop its e-commerce business. In 2019, Walmart introduced Grocery Unlimited - a $ 98 subscription per year, which allows customers to create orders for food products online and receive them with home delivery. The company is expanding the list of products available for fast delivery to make the subscription more attractive for customers and to compete with Amazon Prime in the categories of products in which Walmart is most successful (Casadesus-Masanell & Elterman, 2019). Similar to the case of Amazon, Walmart uses the unique resource of a wide network of grocery stores to compete, and this shows the resource approach of the company's business.

3. Analysis of the company's interaction with external market players.

Cooperation, mergers, and acquisitions

The first step in this direction was the acquisition of Jet.com Internet company to develop an e-commerce department in 2016. It was at that time when Walmart began to accelerate the transition from being a "retail giant" to a company driven by advanced technologies. The startup management and most of Jet's employees took responsibility for all Walmart e-commerce. This was the starting point for a strategy to optimize processes, lower prices, and ensure fast delivery. The deal with Jet.com allowed the retailer to strengthen the integration between offline and online businesses. This was followed by partnership agreements with Alphabet (Waymo unmanned vehicles), Rakuten, as well as Uber, Lyft, Postmates to enhance delivery capabilities. Walmart expands the number and variety of products offered online by collaborating with brands such as Lord & Taylor and Fanatics (Бine, 2019). Agreements with other brands allow to expand the range of products offered online to compete with Amazon and other market participants.

4. Analysis of the company's exposure to competitors.

Competition analysis

In 2018, a Market Track study was conducted, which concluded how Walmart is trying to attract Amazon users. Initially, in television commercials, Walmart advertised its free two-day delivery, with an emphasis on not requiring any membership, which could be seen as a reference to the membership of Amazon Prime, its main competitor. The research also showed that Walmart's customer engagement strategy was launched sometime before Amazon Prime Day. This day is the annual Amazon campaign, on which a record number of purchases are made. Therefore, Walmart started to reduce prices for some groups of products a week before Prime Day and kept them at that level until the end of the competitor's campaign (Andria, 2018).

Conclusion

The above factors are key in Walmart's strategy to capture market share in online retail. Although almost half of this sector in the U.S. is occupied by Amazon, according to the analyst eMarketer, Walmart shows stable development in the direction of e-commerce and gradually increases market share in this direction, albeit slightly. The online retail market is highly competitive at the moment and the company's strategy is being shaped in line with the red ocean and price leadership. At the moment, the largest retailer is competing on the U.S. online market, where about half of the market belongs to Amazon and it is most difficult to fight. Applying the same solutions to other markets where market participants have less power can allow Walmart's online direction to develop much more rapidly. At the moment, Walmart's strategy in offline trading, which remains the company's core business, can be defined as global, since the company's activities are global, while the decisions are implemented at its headquarters in the United States.

Alibaba competitive strategy

1. Company overview: characteristics and peculiarities of the company's position.

Alibaba Group Holding Co, Ltd is an international company with the main market of activity in China, but it is also successfully expanding into markets of other European and Asian countries. Subsidiaries provide participation in the C2C, B2C, and B2B segments in organizing trade via Internet services. Alibaba's strategy can be defined as multinational since the company approaches, the methods of building its activities and marketing campaigns considering the individual characteristics of the regions and creates strategic alliances in the areas of its activity. Today Alibaba is among the top 10 companies in the world in terms of capitalization and operates in all major markets. Since its IPO in 2014, the Alibaba Group has shown incredible growth. Alibaba's e-commerce platforms reached 960 million active users in 2019.

The group currently operates in four main segments: eCommerce business platforms, cloud technology, and computing, digital media entertainment and innovation, and financial services. Alibaba's primary source of revenue continues to be the Internet commerce business, while other divisions complement the company's business model. In fiscal 2019, Alibaba's total sales through its online commerce services reached $900 billion, the highest level in global e-commerce. Other business segments are also showing rapid growth. Alibaba's business lines are part of the company's well-established ecosystem and contribute to Alibaba's core eCommerce services, while also having the potential to grow independently. The company's online trading business area includes platforms such as 1688.com, which is dedicated to B2B sales at home and abroad; TMall Global, a division is a B2C platform for brand manufacturers; AliExpress, a platform dedicated to international B2C online retailing; Taobao, a C2C service allows users to buy and sell between members (Alibaba, 2019).

2. Analysis of resource management in the company's strategy.

Business Support Ecosystem

Many modern companies try to build an ecosystem around their core products to create additional value for the consumer. The peculiarity of Alibaba ecosystem is that it is largely built for platform participants. Since the company is not a retailer, does not sell directly or compete with other companies on their platforms, as Amazon does, it aims to create the best environment for partners. Alibaba builds this ecosystem of services that create added value for the retailer.

Ant Financial Services is a unique solution for SMEs that makes it easy to get credit for business development. There was no developed financial system in China. Credit scoring and other methods of assessing creditworthiness are underdeveloped, which creates significant problems with obtaining loans for small businesses. The situation is aggravated by the fact that many entrepreneurs in China do not keep accurate records of their business activities, which makes it difficult to apply for a loan in banking institutions.

The company has established a division called Ant Financial Services. Participants in the company's platforms can apply for a loan and are not required to submit any documents. The decision to approve the application or reject it is made in a few seconds. The loan proceeds to the seller's online account in Alipay within a few minutes. This is made possible by the fact that Alibaba has access to information about potential loaners, as they do business on the company's platforms. It can examine transaction data and determine whether the seller's business is successful, if there are transactions that undermine trust, the seller's operating time or if the seller's offers are competitive in the market. It can examine transaction data and determine whether the seller's business is successful, the presence of transactions that undermine trust, the seller's operating time, or whether the seller's offers are competitive in the market (Zeng, 2018). The company's financial platform is an advantage that attracts new sellers to the system while also increasing profits. In addition to Ant Financial, Alibaba Group has other business support platforms that operate in the areas of software, logistics, big data research.

3. Analysis of the company's interaction with external market players.

Strategic partnerships in new markets

Alibaba establishes strategic partnerships to enter new markets, with a focus on local companies with a large customer base, as well as improving logistics, payment services.

With the entry to the Russian market, one of the most successful for the marketplace, AliExpress concluded partnership agreements with payment systems Qiwi, WebMoney Transfer, Yandex.Money. The company merged with Tinkoff Bank to launch a loyalty program through bank cards.

Alibaba created a joint venture with Russian companies Mail.Ru Group and Megafon. The parties plan to create a single platform for social communication, games, and shopping. Through the agreement, AliExpress Russia will have access to an audience of local partners in social networks, messengers, email, and online games. Besides, the parties expect that the joint venture will help the development of SMEs in Russia: entrepreneurs will be able to sell their goods to consumers from China, Southeast Asia, Turkey, Europe, India, and other countries (Mail.ru, 2019).

By entering the European market, especially Spain, Alibaba also focuses on building relationships with local partners to better assimilate into the new environment. Since the start of the Spanish market, well-known local companies have joined the platform: El Corte Ingles, a huge chain of department stores, has placed several product lines, La Tour cosmetics seller has also started to sell on AliExpress (Anwar, 2017).

4. Analysis of the company's exposure to competitors.

To attract local businesses, AliExpress aggressively reduces the commission for sellers on Amazon to engage them to operate on its platform. Although Alibaba's model is slightly different from that of Amazon and Walmart, and the company is not a direct seller, its financial performance and growth rate make it one of the most significant players in the international e-commerce market. Due to product differentiation, the company has no direct competition with major online retailers, but their activities are in the same industry, which makes the red ocean of competition. In this case, due to such factors as the created eco-system of units, the success achieved in the Chinese market, one of the most highly competitive, and the approach used when entering other countries, the company has become one of the leaders in the field and has great prospects for development.

2.2 Case study of sharing economy sector

Industry profile

The "sharing economy" is most often seen as an alternative to private property ownership. In this context, it is mostly about an accessed-based consumption model. It represents a transition from a model of selling a certain product or service to a model of selling the possibility of using it. The most successful projects of sharing economy are realized exactly as the technological platforms which gain profit at the expense of providing convenient software for linking together the resource owner and the consumer (person, community, or company) who need this resource.

The most significant transformations in this area are associated with the refusal to own property, the unwillingness of modern people to bear the costs associated with such ownership. This global trend has become a competitive business model that radically changes the nature and intensity of competition in modern markets. According to a survey prepared for the World Economic Forum in Davos in 2016, the development of the sharing economy is classified as one of the leading technological drivers of the fourth industrial revolution (WEForum, 2016). Services and platforms of the sharing economy influence the development of individual markets, expand opportunities for small organizations and individuals to produce and promote goods and services that previously were available only to large organizations.

The global segment of the sharing economy is forecast to grow from $14 billion in 2014 to $335 billion by 2025. The development of the sharing economy is primarily due to the emergence and active spread of new information technologies, which not only made it possible to include geographically dispersed large groups of people in the process of joint production, exchange and consumption of goods and services but also made it truly simple, convenient, significantly reducing costs and risks of such activities (Osztovits Б.; Kхszeg Б.; Nagy B.; Damjanovics B., 2015).

Airbnb competitive strategy

1. Company overview: characteristics and peculiarities of the company's position.

The idea of a shared consumption economy has changed consumer behavior, making it possible to use private housing for short-term accommodation. Contact between stakeholders is made through an online platform. Companies providing alternative accommodation options have developed rapidly. A feature of the company's product is the opportunity to easily scale business, as the information platform is the core of the business model, it allows the company to use a global strategy and reduces barriers to entry into the markets of new regions. Currently, Airbnb has more than 7 million properties located in more than 100,000 cities in 220 countries. The Airbnb platform is used by 150 million people (Airbnb, 2020).

2. Analysis of resource management in the company's strategy.

Differentiation

Airbnb offers visitors properties all over the world from ordinary people, so their product is different from the usual tourist offers (hotels or tours). The company offers travelers a completely different experience. What Airbnb provides is not always the cheapest accommodation for the tourist, for the time being, it is often the opportunity for the traveler to feel in a new place as a resident. It is an opportunity to meet locals, feel the atmosphere of the region, find non-tourist places, and understand the region better. To enhance the uniqueness of the stay, Airbnb has introduced a new "experience" resource where people can find the most incredible leisure offers for tourists where locals act as guides. Restaurants" have also been created to make it easier to find local cuisine offers. Airbnb allows users to experience the local experience as if it were their hometown and house. Airbnb is creating a whole new segment of tourism and other recreation by providing accommodation that is different from hotels. This differentiation has become very popular, and the company started using other methods to develop its service and make its product even more interesting for users.

3. Analysis of the company's actions aimed at increasing market coverage.

Segmentation

The idea of staying at a resident's home while traveling was very popular, but Airbnb decided to segment its product to become more attractive to wealthy consumers. Since Airbnb is a free platform for accommodations, some real estate offers may not have the basic characteristics that are important to vacationers and may not be in good enough condition or have flaws in appearance.

Airbnb has a virtually unlimited range of accommodation options, from a shared room bed to an exotic hut or luxury mansion. Whereas at the beginning of its development Airbnb had mainly low and medium budget facilities, the platform has now created the Airbnb Plus section, a special offer of first-class accommodation for demanding travelers. Since 2018, unique offers have been offered to luxury travelers, Airbnb has created a collection of 4,000 high-end accommodations that have been personally verified by Airbnb representatives. A major advantage of Airbnb is the possibility of multi-room accommodation suitable for families, friendly companies, or travel groups.

In 2017 the Business Travel Ready platform with offers of accommodation for business trips was launched. Airbnb also agreed with WeWork, a company that book offices, meeting rooms, and conference rooms. Actions taken by Airbnb have shaken seemingly obvious advantages of traditional hotels to serve business travelers.

A fundamentally new form of Airbnb development was the Niido Powered by Airbnb project, which provides for the creation of a network of residential complexes where tenants have the right to sublease their accommodation using an online platform. The project also provides support in apartment maintenance and cleaning.

Expanding its capabilities, Airbnb has started to offer hotel room offers, in particular in partnership with the Chвteaux & Hфtels Collection, Airbnb has placed the resources of this network of hotels with a local flavor on its platform. Airbnb also purchased the Hotel Tonight online application, which offers discounted hotel rooms. The application has more than 15 million users around the world (Guttentag, 2015).

Analyzing the above facts, it is possible to conclude that Airbnb is forming a multi-component business that is not limited to one line of business.

Insurance of risks

As mentioned earlier, Airbnb is a rental service that connects property owners with customers. Since homes are rented out by ordinary people, there are a significant number of properties where landlords currently live. They either rent out vacant space or the entire property when they move out. Renting your accommodation to visiting tourists entails risks associated with property damage. In this regard, the company provides guarantees for the owners of the property, the rented property is insured up to $1 million. Airbnb has taken over the fears of its customers and created a comfortable environment for all parties to the business.

Enhancing trust

The cost of attracting new customers is expensive, so Airbnb started using the method, which is to attract new customers through users who already had experience with the service. The Airbnb referral program has become a way to build trust as well as an incentive for users to attract new customers to the service. The Airbnb concept was unfamiliar to a potential audience that had never used it before - users considering using the platform had questions about the safety and reliability of the service. The essence of the referral program of the service is that by inviting a person user receives a bonus from Airbnb. Thus, the client does not do a favor and both parties in the program are motivated to act. This solution allows the company to build up its client base and gain much-needed trust in the first years (Al-Saad, 2019).

Product Conclusion

Airbnb managed to create a new market segment and not start its business in the red ocean of the travel market. Positioning themselves as a way to experience new travel experiences rather than as a website for booking accommodation, they managed to build a successful business with an understanding of their customers' needs (on both sides).

Uber competitive strategy

1. Company overview: characteristics and peculiarities of the company's position.

Uber is an international taxi service company founded in 2009 in San Francisco, California, USA. The company has created a mobile service that allows passengers and drivers to interact. Uber as a startup had a large number of investment rounds, which allowed the company to quickly expand its presence in emerging markets and more flexibly respond to environmental challenges. The estimated value of Uber is currently more than $60 billion, which is more than the value of its main competitor. The huge amount of money raised in the first years of the company's operation allows it to develop actively despite its clear loss-making capacity. Uber is an example of a company that uses a multinational strategy to develop in the global marketplace. It has a widely diversified product line that is adapted to the specifics of each market. Besides, the company applies several strategies to enter foreign markets and uses joint ventures, strategic alliances, and wholly owned subsidiaries. Nowadays, Uber is available in 71 countries and over 890 cities worldwide (UberEstimator, 2020).

2. Analysis of resource management in the company's strategy.

Price

One of the main competitive advantages of the company is cost leadership, which shapes the strategy. Since Uber does not use the usual model of business organization in the taxi industry, it does not incur the cost of owning and maintaining vehicles, and drivers do not spend money on obtaining licenses, which are provided in some countries. At the same time, the company follows a dynamic pricing strategy: the final cost depends not only on the class of car and the cost of travel but also on fluctuations in supply and demand at the time. The capabilities of the technology platform make it possible to predict places with higher demand and increase the number of available cars due to changes in demand. All this affects the final price of the service and makes it cheaper than competitors with a traditional model. This factor illustrates the resource approach of the company, which is driven by the company's platform that allows it to outperform competitors with traditional business models in the transportation industry in operational efficiency (Wallsten, 2015).

Working with losses

Uber was very successful in attracting investment at an early stage, which allowed the company to develop rapidly. Access to additional capital allows Uber to bear the high costs of attracting drivers, continuing geographical expansion, and building better infrastructure. Broad funding is Uber's competitive advantage, which makes development a priority. In this regard, it is possible to draw an analogy with the strategy of Amazon - both companies despite the losses sought to scale up the business as quickly as possible at the expense of profitability. Rapid growth, both in the U.S. and around the world, allowed Uber to raise new funds and enter the IPO, despite the constant operating losses (Conger, 2020). The focus on growth and development is well suited to companies with innovative products, as the firm's potential allows it to attract investment despite the lack of profit. The ability to develop over the long term and still incur losses through access to significant investments is a direct indication of the company's resource approach, which is enhanced by the use of a unique platform in the red ocean by traditional taxi services.

Therefore, it was found that Uber's strategy is based on access to significant financial resources, focus on service scaling, continuous improvement, and using the advantages of the platform to compete in the international taxi market.

3. Analysis of the company's actions aimed at increasing market coverage.

Segmentation

The range of services offered by the firm varies from country to country. The main business of the company is a taxi service and its main segments are UberX, UberSelect, UberBlack, UberSTART, UberKids. UberKids, for example, provide a service to transport children from 3 years in a car equipped with a child seat. UberSelect and UberBlack are premium segments and offer a high level of service quality (Dudovskiy, 2018). Segmentation allows the company to address all customer categories and meet their different requirements. Combined with extensive service functionality: the ability to divide costs among passengers, tracking the location of the car, determining the estimated time of arrival and the availability of various methods of payment, the quality of the company's services is superior to traditional companies in the field of taxis.

Strengthening own brand

In a standardized service, the strength of a particular brand plays a very important role in increasing a company's competitiveness. Uber uses a relatively open media strategy and also pays great attention to the opinions and wishes of consumers, which it collects via feedback forms after using the application. The company also positions itself as a service that aims to improve urban transport systems by reducing the need for parking spaces, traffic, and air pollution (Cannon & Summers, 2014).

Focus on service development

Constant improvement of the offered service is a priority for the company. This applies not only to its quality but also to the differentiation of services provided, as Uber strives to fully meet changing consumer preferences and expectations. To this end, the company introduces additional features to the application and also launches third-party services in some markets. Many of Uber's value-added services are still under testing. Uber has a number of other brands for services not related to the taxi segment. The most striking example of a third-party service is UberEats - food delivery service, at the moment about 15% of the company's revenue is generated by the UberEats division.

Localization

In order to be successful, the company always employs local office workers who know the market and the business environment. The company has a variety of products available in different countries. In Dubai, for example, the company offers users options to order electric cars or helicopters. In Turkey and Croatia Uber offers an order for a boat taxi. Exactly local management makes the decision at the beginning of providing a service in each cover town. In addition, localization implies not only localized services but also cooperation with a local business. In China, for example, Uber works closely with Alibaba, which provides the company with its own Alipay payment system. In Russia, the company has established a joint venture with the major local player Yandex.Taxi, before which the companies fought a fierce price war for taking market share.

Client base growth

Uber emphasizes that customer satisfaction should be expressed in appropriate recommendations of service to friends, as it is an effective and rather cheap way of promotion. Thus, the main initiative to promote the Uber app for customers is to provide a free trip for registered new users, as well as a peer-to-peer marketing system, when a customer is awarded bonus rubles to travel when inviting a friend, a model similar to that previously described by Airbnb. According to CB Insights, more than 95% of new customers have learned about Uber through other users (CBInsights, 2018).

Conclusion

Uber is currently the world's leading taxi service company. With its platform capabilities and its own business model, the company offers the best conditions for its customers and is developing rapidly. Despite the unprofitability of the company, investors' expectations are positive, which is evident in the successful attraction of additional funding, each time increasing the estimated value of the company.

2.3 Case study of streaming video services sector

Industry profile

The emergence and distribution of streaming platforms with video content available on request has a major impact on the entertainment and media industry, in particular, TV advertising, pay-TV, and film distribution segments. At the same time, this segment is at an early stage of its development: video services, the number of which is rapidly growing, are in search of the most optimal business models, actively enter new markets and significantly increase investments in content. Several advantages contribute to the popularity of streaming platforms compared to pirate platforms, from viewing convenience and higher quality video to ensuring cybersecurity and safety of the content itself.

After a while, the first streaming services that appeared in developed countries with the most prosperous population began to have a significant impact on the business of traditional media companies, primarily broadcast and paid TV channels, dragging part of the audience and, consequently, the revenues. Responding to changes in the market, TV channels and pay-TV operators began to launch their streaming services, and companies from related sectors, such as telecom operators and Internet holdings, are actively joining them.

Currently, the video streaming segment has reached the primary level of market saturation in the most developed countries, which forces the streaming services to actively enter new markets. At the same time, the number of video streaming platforms continues to grow, which leads to fragmentation of users' attention and increased competition between the services themselves. It is expected that in the period until 2023 the global market of streaming video services will grow by an average of 13.8% per year, and its volume will reach $72.8 billion. (compared to $38.2 billion in 2018). It should be noted that this estimate includes only income from subscriptions and one-time payments. Below will be investigated the competitive strategies of major players in the international market with different approaches to conducting business: Netflix - the leader of the segment at the moment, Disney - one of the largest corporations in the entertainment industry, which is entering the market of video platforms, Amazon Prime Video - the service of the e-commerce giant, which is designed to increase the coverage of market industries by the company.

Netflix competitive strategy

1. Company overview: characteristics and peculiarities of the company's position.

Netflix is currently one of the largest online film and series suppliers in the world. By April 2020, the audience of the streaming platform reached 182 million users, including 69 million customers in the U.S., where the company began its operations. Many leading media outlets refer to Netflix as the most successful streaming media distributor in history.

The company was founded in 1997 and offered a convenient method of renting movies and TV series. The business model was built in the way that, by subscribing to the service, it provided the opportunity to rent DVDs of movies without having to visit a store or office - the service was provided by mail and bank payments.

In 2007, Netflix began distributing streaming video, and it was the measure that made the platform one of the largest companies in the world. The transition to the new model was associated with the gradual phase-out of DVD media - and with the advent of cloud services, most of the information began to be stored on the Internet. A new niche emerged that the company has been able to occupy.

In September 2014, it was announced that the preparation of the first own film produced by Netflix had begun. And by 2016, the company entered the market in 190 countries. Netflix projects have several awards of the American Academy and a huge number of Emmy awards (Brennan, 2018).

In the second half of 2018, Netflix's revenues from the international market exceeded those from the US domestic market. Netflix's globalization strategy and the many barriers facing streaming services are unique. Companies are challenged by certain regulatory restrictions, language, cultural, and user habits of free content instead of paid content platforms.

Also, strong competition in the field of streaming services exists in many countries, often due to the presence of strong local producers, which undoubtedly makes it difficult for a foreign enterprise to enter such markets. However, Netflix has the largest number of users in the global reach of all worldwide streaming platforms. Moreover, the closest services in terms of audience size are from the Chinese market and are not represented in the global segment.

The business model of Netflix Inc. platform allows one to be an intermediary in the implementation of third-party content and, at the same time, to avoid intermediaries in the implementation of their media projects, directly distributing them to customers through its service, creating a unique.

The overall strategy of Netflix Inc. is to combine cost leadership and product differentiation - the company mainly uses cost leadership as a strategy to achieve a competitive advantage, but differentiation of the company's activities also allows increasing success in the market. Cost leadership provides an opportunity for the company to create online entertainment with a focus on low costs and, accordingly, to create an affordable price offer. The research conducted by ProfitWell agency shows that Netflix knows its customers very well. A survey of Netflix users showed that the cost of the product is in an optimal condition (Campbell, 2020). The median of general sensitivity to the price of these customers is $10.99, the same is the price of a standard subscription service. It was also analyzed that regardless of the level of family income, people are willing to pay about the same amount for Netflix, this allows almost no price segmentation when promoting the product.

Netflix differentiation implies the development of products in such a way that they differ from competitors - the platform develops the production of its original content in addition to the implementation of online entertainment from third parties (Sadq, 2013).

Thus, the company managed to achieve leadership and far ahead of its rivals in the fast-growing video content industry. Below are the competitive strategy factors that enabled Netflix to achieve the best results in its niche.

2. Analysis of resource management in the company's strategy.

Acquiring new content

Creating its unique content is a new trend in the streaming services industry, so Disney+ started with a $2.5 billion budget for original content and the entire library of Marvel, Lucas Films, and Disney movies. Amazon has allocated $6 billion for 2019 for exclusive content. However, Netflix has spent $15 billion on content in 2019 and plans to spend $17.5 billion in 2020 (Vlessing, 2020).

Netflix is also investing in real estate, currently in leasing, to build its studios. Disney Studio is working with Netflix to produce original content for Netflix consumers in international markets.

A few years ago, the platform's main offer was content for which the company acquired rights from its creators. However, nowadays Netflix actively creates exclusive media projects, the uniqueness of which is aimed at forming a competitive advantage and increasing the value of the resource for consumers.

Netflix had a time advantage, which the company correctly used. They have practically created a market of online cinemas and for several years now have been setting its direction. With the 2020 quarantine, the audience growth on the platform increased, which accelerated the company's development. Thus, at the moment, nothing prevents the global expansion of Netflix. The company has established itself on the leading positions on the world market of streaming services for many years and, considering the development of its content, is not going to stop at the achieved level.

Core Product

The Streaming Platform is Netflix's core product and the company is focused on improving these services. At the same time, for other competitors in the field of content implementation is only a complementary line of business, which is often created for greater diversification of the company. The services of Amazon Prime Video and Apple TV+ allow their producers to increase the value of the main product and create an ecosystem from different directions. The Disney+ and HBO Max business units are also complementary business units of companies whose main task is to produce media products on a global scale. Thus, in contrast to Netflix, competing services are only complementary to their core products. With comparable sizes, Netflix can focus on the development of the content platform and create more competitive advantages for the service.

3. Analysis of company actions undertaken to create competitive advantages.

IT company

Netflix is a leader in content delivery, and one of the success factors is the company's level of technology. The service creates excellent video, sound quality, user-friendly interface, in every direction there is a constant work: constantly improving the stability of the service, developing new compression algorithms, improving the interface and the introduction of new features.

One of the main competitive advantages of the company in terms of technology is the recommendation content system with the use of artificial intelligence. The function developed even at the stage when the company was engaged in renting DVDs. Based on the browsing history, evaluation of the impression of the viewed content, the service gives users individual recommendations for new content and determines to what extent the offered material is suitable for a particular client.

Also, Netflix analyzes customer aggregated data about service usage to determine which offers to find the best customer response. As the number of international subscribers grows, the performance of its forecasting algorithms continues to improve.

Netflix also uses intelligent analysis of customer view data to assess the success and potential cost of content. The company determines which content gets the best response, predicts user interests for the next premieres, and shapes pricing policies with producers based on the collected data. This allows us to determine the appropriate final price for the product and the required contract period.

Netflix's approach to platform technology development can be seen as the use of a resource approach and a focus on strengthening technical equipment, which is a strong and, at the same time, difficult to repeat competitive advantage in the industry (Moore, 2019).

Worldwide Cinema

In many countries, such as China, India, South Korea, and Japan, locally produced films often lead the way in distribution. At the same time, distribution revenue in such countries is increasing from year to year. Netflix has recognized the potential of foreign film industries in 2015 and has continued to develop this direction ever since. During that year, the first non-English content from Netflix appeared on the platform - the Mexican series "Club de Cuervos". The following year, when the company entered the markets of 190 countries and presented Netflix Original content produced in Brazil, France, and Spain. In 2018, one billion dollars was invested in content produced in Europe, and by the end of 2020, it is planned to launch up to 100 new non-English language projects (Lobato, 2019). This approach can be seen as a shift from a global to a multinational strategy in which the company plans to evolve towards content creation by local producers in different regions, while adapting it for global sales.

At the moment Netflix produces and buys the rights to international rentals in almost all countries of the world, and this foreign content is created by local producers, so the projects do not lose their identity and are popular both domestically and internationally. An excellent example of successful content from other countries is "La Casa De Papel" - the most popular foreign project Netflix, the third season of which watched 35 million users per week (Iqbal, 2020).

For a long time, Netflix has been developing the direction of foreign releases, which allows it to successfully penetrate new markets and make the range offered by the company more diverse and familiar to residents of new regions. At the same time, this approach is a profitable advantage - the nearest competitors of Disney, HBO, or Apple are not planning foreign releases soon.

Improvement of user experience

The combination of a competent recommendation system, user-friendly interface, and lack of advertising on the platform allows putting the quality of user experience in priority. The company has decided not to use advertising on its platform for a long time, as despite the direct income, such a tool greatly distracts the viewer and spoils the interaction between the client and content. The company's flexibility in applying changes is another aspect of prioritizing user experience. The platform tests the functions during their implementation and removes unclaimed ones, to create a simpler environment. Thus, the previously implemented "advanced search" function was removed, as it did not cause significant demand from customers. Thus, the company aims to create an atmosphere for maximum customer focus on content and eliminate all distractions and spoilers.

4. Analysis of the company's interaction with external market players.

Creating new distribution channels and strategic partnerships

Over the past few years, Netflix has been actively expanding and developing into new markets. The company has created partnerships with important local companies to establish mutually beneficial relationships. For instance, one of the ways to create synergies is through alliances with cellular and cable TV operators, which have made the platform more accessible through their own sales channels. One example of such cooperation is the launch of Vodafone's television service in Ireland, where Netflix has been allocated a separate button on its remote controls, which simplifies access to the company's service and allows it to attract an additional audience. Besides, Netflix's case concluded partnership deals with Telefonica and KDDI telecommunications companies in Spain, Latin America, and Japan.

In addition to cooperation with telecom companies, the platform produces foreign original content in 17 different markets. At the same time, such projects are aimed not only at the clients of that region but also imply promotion in the global market and contribute to the delivery of content in all markets of the company simultaneously. Such solutions enable the creation of regionally produced media products, benefiting jointly both local producers who gain access to a global audience and the company itself, which has a more appropriate and, at the same time, diverse content for residents of different regions.