Contemporary competitive strategies of international companies

Additionally, Netflix works with leading hotels in the United States and around the world, such as Marriot International, to gain access to hotel customers and improve their leisure time. The application developed by Netflix provides free access to Netflix content for hotel guests via in-room TVs. If guests are already customers of the service, they can continue using their subscription, otherwise, they can create a new account (Roxborough, 2019). This is an additional channel to introduce the products of the platform to potential customers and to attract new customers among hotel chain visitors. Therefore, a company's strategy when operating in the markets is often implemented through the creation of strategic alliances.

Disney+ competitive strategy

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

The Walt Disney Company is currently one of the largest players in the modern media market. Until 2019, the company was related to the video streaming market through a distribution agreement with Netflix. However, in 2017 Disney announced plans to launch a new service for the distribution of video content, at the same time the company reported about its plans to move to it all their films, which shows Netflix, as well as new shows.

At the end of March 2020, the Disney+ service was launched in several Western European countries, including the UK, and in early May the number of subscribers increased to 55 million. In expanding into the international streaming content market, the company has a global strategy based on the company's highly regarded products, which are known and demanded worldwide.

The service was launched in the U.S. on November 12, 2019, after the expiration of the existing deal with Netflix, and focuses on film and television content from the major entertainment brands of Disney, which include Walt Disney Studios, Pixar, Marvel Studios, Lucasfilm and 20th Century Fox. Besides, Disney+ also features new original series and films and announced new content from Marvel and Star Wars. Launched at the end of 2019, Disney+ offered an affordable price policy of $6.99 per month and will offer a combined package providing Disney+, ESPN+, and Hulu content. The cost of the tariff plan giving access to the content of all three platforms - $ 12.99 per month - is the same as for the most popular Netflix package. Thus, subscription to Disney products is cheaper or approximately equal in price to the offers of other competitors. At the same time, Disney offers a variety of entertainment, family, and sports content (Sorrentino & Solsman, 2020).

Since the launch of the Disney+ video service, about 55 million people have become regular users of the platform in the United States. Thus, the launch of the platform turned out to be extremely successful and surpassed the company's forecasts, which expected to reach a global audience of 60 million by 2024. Although Disney+ is just beginning its expansion into the streaming services market, there are several factors of competitive strategy that make it an important player in the industry.

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

Experience in content creation

The strategy of Disney+ and the market leader, Netflix, has slightly overlapping, and both companies have different approaches - so there might be no direct competition between them at the start of the service. Content offered by Netflix is different from the competitor's and extremely diverse, while Disney relies on its content and popular franchises that are in high demand among fans.

In the red ocean of competition in the streaming segment, the content has become an important feature of each platform. Market participants strive to ensure product quality and keep the viewer in their service. This has led to a trend towards exclusive agreements between producers of films and content platforms, where the latter are paid to become the only supplier of the most popular premieres. However, licensing exclusivity is not a reliable solution for creating a successful platform in this business sector. The reason for this is that any contract could be changed or terminated, which would lead to the loss of the platform's attractiveness for clients (Wingard, 2019). For instance, at the time of the announcement that Disney plans to launch its platform and will no longer provide content for Netflix when the existing contract expires, Netflix shares showed a significant decline.

As a result, all companies in the industry are switching to creating original content that makes them unique. In this situation, Disney has an extremely large competitive advantage in the form of a portfolio of projects that have been created for decades, they are familiar and highly valued by consumers around the world.

When launching the service, Disney is primarily focused on its own experience in creating media projects and its huge portfolio. Numerous films already released and deserved worldwide success of the company are a serious competitive advantage in the red ocean of streaming content. Besides, Disney continues to develop the history of its most famous films - it was signed a deal with writer and director Ryan Johnson, to continue the list of films about the universe of Star Wars and create new scenes. This is not the only development of the company's most popular stories; it was reported that Disney is developing a series of original TV shows for its future video streaming service. Which includes a TV series based on Star Wars, a new Marvel project, and others.

At the start of the platform in the Disney+ directory, there are already 300 films and 7500 episodes of TV series of the company. Subscribers will also have access to Star Wars franchise films, Pixar, and the Marvel universe. In the first year of work, the number of projects will increase to 400 (Alexander, 2018). This clearly illustrates the company's resource approach, in which Disney uses its unique experience and portfolio to enter the video streaming market, creating a competitive advantage in the competition for consumers already familiar with the company's products.

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

Synergy of marketing

The established diversification of Walt Disney's business is a strong aspect that can contribute to the launch, public perception, and, eventually, the success of Disney+. The company applies synergy marketing to more effectively implement its activities and encourage consumers to purchase the product. For instance, the distribution of movies raises the audience's interest in the company's characters, and consumers subsequently encounter other areas of the company's business: branded stores, entertainment parks. This chain of forming the client's interest in buying impressions from the company also works in reverse order, where the audience gets acquainted with the characters in the secondary Disney businesses and then shows interest in the film premiere (Francoeur, 2004). The new streaming content platform fits perfectly into the created ecosystem and will receive an additional audience, therefore, as well as contribute to the development of other divisions of the company.

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

Acquisitions and diversification

Disney is actively acquiring outstanding companies from the film industry. It has developed a dominant position through multi-billion-dollar purchases: Pixar was acquired in 2006, Marvel in 2009, and subsequently Lucasfilm. In March 2019, Disney acquired the key assets of 20th and 21st Century Fox for $71.3 billion (Gartenberg, 2018). All of these acquisitions represent a major strengthening of Disney's portfolio of materials for its streaming platform.

Although Netflix, the market leader, has made massive investments in its content creation, Disney's development of streaming has great potential for capturing market share through an impressive collection of projects formed by long term activities and massive acquisitions. Along with already well-known TV shows and movies, Disney also plans to focus on creating new unique premieres for the new platform. With a large amount of unique content, Disney does not have to bear the high costs of investing in new projects, but the company still plans to pay attention to creating new unique releases for the new platform.

Disney+ Summary

The growth of the service in the last two months was probably also due to the pandemic, which hit the US and Western European countries particularly hard. At the same time, Disney+ is still not available in many countries and the audience of online cinema is growing rapidly. And although at the moment Netflix is the leader in the industry with 182 million users, its growth rate is decreasing, and competitors have the opportunity to fight for the leadership (Alexander, 2020). At the same time, Disney+ is even more successful than the company's predictions - when it was launched, it was projected to have 60-90 million users by 2024, but even the top could be reached within the first year.

Amazon Prime Video competitive strategy

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

In this study, the strategy of the company Amazon has already been considered, but in the context of streaming services, it is worth highlighting the direction of Amazon Prime Video. The Amazon video service started in 2006 and since then it has had several rebrands, originally called "Amazon Unbox" - and provided customers with the opportunity to receive TV episodes, movies, or rent their films. By the end of 2008, the service had been rebranded and began providing customers with access to streaming content, allowing viewers to watch videos using a web browser. At the beginning of 2011, the service was changed again and began to form a platform in the format in which it gained popularity and is currently available. The division has been included in the Amazon Prime subscription, which gives customers access to movies, TV shows, additional benefits in e-commerce, offering free 2-day delivery for a fixed annual fee (Warren, 2011). By 2017, Amazon Prime Video is available in over 200 countries. However, as noted in the chapter on the e-retail market, Amazon uses a global strategy in its international operations and the video content division is not an exception.

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

One of the main reasons that make the platform popular is that the streaming content direction for the company is complementary and is one of the elements that create the attractiveness of an Amazon Prime subscription. The paid subscription system is extremely popular in many countries and has a significant competitive advantage in the form of fast delivery and additional promotions, but services to provide video content or music further enhance its value to the client (Csathy, 2020). This enables the company to build customer loyalty and attract new users to the ecosystem - main recourse of the company, even with less content than its main competitors.

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

Amazon pays enough attention to the development of its content portfolio - the company emphasizes exclusive digital licensing agreements. Such examples are the exclusive production of Top Gear for the platform and a multi-year exclusive licensing agreement with HBO for the digital distribution of content from the range of television services. The cost is another factor in the platform's success - currently, Amazon Prime's subscription costs $10 per month, thus offering content for less than Netflix and other competitors. However, the subscription of the company provides much more opportunities, its main competitive advantage is the conditions in the e-commerce segment of the company, which makes Prime Video service free for most of its viewers. Since it is only an addition to the main service, which is the fast delivery of millions of products from the Amazon.com market (Patrick, 2019). In the case of Prime Video, the company uses cost leadership in combination with the resource approach - the competitive advantage is the ecosystem of the company's products, which is unique and absent among competitors.

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

Amazon pays enough attention to the development of its content portfolio - the company emphasizes exclusive digital licensing agreements. Such examples are the exclusive production of Top Gear for the platform and a multi-year exclusive licensing agreement with HBO for the digital distribution of content from the range of television services (Barraclough, 2015). Industry summary

Thus, the current video content streaming market is very competitive, and its participants use different strategies to achieve leadership. Netflix is the most popular platform among the world audience and continues to grow rapidly, but other market participants are also actively developing their products. In the segment, there is a trend for each company to create uniqueness and increase its original content, which will make the company the most attractive for consumers.

Chapter 3. Defining best practices

3.1 Method

The presence of a competitive strategy in the contemporary dynamic business environment is a factor that allows companies to develop following the market environment and achieve leadership in the niche. To assist these companies in development planning, in which the competitive strategy has a crucial impact, practical highlights for creating a successful IT business will be developed in this part.

The main method for defining best practices is to analyze companies that have already established themselves as leaders in their niches and can be considered as benchmarks.

After studying the material and structuring the information in the first and second chapters, a general approach to creating a competitive strategy can be formed.

At the first stage of strategy formation it is necessary to determine the position of the company in the sphere. The position of the organizations examined in this study at the stage of strategy formation is represented by three different types: companies involved in the industry, companies entering the industry and companies creating a new direction in the industry. Each of the types described in this paper has its own set of features and capabilities, so to apply the best practices it is necessary to understand the position of the organization.

After formulating the position of the organization, it is essential to focus on identifying the potential competitive advantages of the firm on the resources that the firm has. By the results of this stage and considering the revealed features of the company it is possible to develop highlights, which are resulted below.

3.2 Electronic retail

The first sphere that was analyzed in this research was the direction of electronic retailing. As the analysis has shown, the direction is highly competitive and is rapidly developing. Three companies were chosen for the analysis, each of them has its specific market position. Thus, Amazon is an absolute leader in the domestic market and is actively expanding into other countries. Walmart is the world's largest retailer, and the company is entering the e-commerce industry and seeks market share in the red ocean of competition. Alibaba has achieved success and is actively expanding its list of countries of presence, and the company's business model is different from the traditional retailer - it is a marketplace and becomes an intermediary to ensure the turnover between manufacturers and customers. The business models and market position of these companies are different, so the highlights developed by the author were created for three groups of industry participants: regular participants, companies entering the e-retail market, and companies with a non-standard business model - marketplaces. Accordingly, the best practices are presented below in separate tables for each of the three groups.

Table 3 Dedicated business models in e-commerce

Table 4 Permanent industry participant highlights

Table 5 New participant in the industry highlights

Table 6 Marketplace model highlights

3.3 Sharing economy sector

The next area that has been presented in this research is the direction of sharing economy. Nowadays it is a new and developing area of property ownership, with Airbnb and Uber being the most successful participants. The second part of the analysis revealed the main features and differences in the strategies of these companies. Thus, Airbnb is the creator of a new direction of the business and the blue ocean in the competitive real estate industry. Uber is a fast-growing passenger transportation service with a competitive advantage in business efficiency based on a technological online platform. As the experience of the two companies is very different, the highlights developed by the author were created for two groups of industry participants: businesses that create the blue ocean in traditional industries using shared consumption and businesses that create a more efficient business in the industry through modern technologies. Accordingly, the best practices defined are presented below in separate tables for the two groups.

Table 7 Dedicated business models in sharing economy sector

Table 8 Blue ocean creator highlights

Table 9 New participant of red ocean in the industry highlights

3.4 Video streaming services sector

The third field that has been analyzed in this research is the direction of streaming video services. Currently, the popularity and volume of this business are growing, more and more companies are entering this niche, and competition is intensifying. Three companies were chosen for the analysis, each of them has its specific market position. Thus, Netflix company is the leader in the world market of streaming content, which is the only product of the company. The second service presented in the research is Disney+ and is a new direction of the company's activity, the development of which is based on the already achieved success in cinematography. The company is just entering the e-commerce industry and is seeking market share in the red ocean of competition. The last service of the research is Prime Video from Amazon is one of the many operations of the company and mainly complements the ecosystem of products, creating additional value to the core business. The company's approach and market position differ, so the best practices defined by the author of the study were created for three groups of industry participants: regular participants for which streaming content is the main product, companies entering the streaming market with experience in the media business and services are complementary to the company's main product. According to this division, the identified highlights are presented below in separate tables for each of the three groups. It is also worth mentioning that while researching the industry, the trend of the contemporary market towards the creation of unique content is clearly traced, therefore, the recommendation for its formation are contained in the tables for all three business groups.

Table 10 Dedicated business models in video streaming services sector

Table 11 Permanent industry participant highlights

Table 12 New participant in the industry highlights

Table 13 Complement to the core product model highlights

3.5 Summary

This bachelor's thesis explored the competitive strategies of leading companies in e-retailing, sharing economy, and streaming video services.

In the direction of electronic retail research is presented by cases of companies Amazon, Walmart, and Alibaba. The companies were selected following the scale of their business, their success, and the peculiarities of their position in the market. The strategies considered in the industry reflect the business focus on adding value to the end product, increasing and improving logistics capacity, and actively using mergers and acquisitions to achieve leadership. Companies strive to establish strategic partnerships in new markets to ensure good access to local audiences.

The next direction of the research is the sharing economy sector, which is rapidly developing and currently represented by two main participants - Airbnb and Uber. The shared consumption model is quite new in the market and has great development prospects. The strategies considered in this direction illustrate the companies' attention to segmentation and differentiation in the industry. The example of Uber illustrates the opportunities to use the strengths of online platforms as a competitive advantage in capturing market share among traditional participants. The Airbnb case demonstrates the creation of a new segment in the market by applying a different concept of ownership and online service capabilities.

The last rapidly growing industry considered the direction of streaming video services. The main global player in this industry is the company Netflix, in addition to it were also examined the nearest international competitors - platforms Disney + and Amazon Prime Video. Each of the companies studied has a different position in the market, and their strategies are significantly different. At the same time, the research revealed a common characteristic in the strategies of international streaming platforms - currently, there is a tendency to create a portfolio of unique content by each platform. Netflix company managed to achieve leadership in the industry as one of the first players, but at the moment, competition is intensifying, and more and more businesses are seeking to become part of this niche.

In this bachelor's thesis, it was possible to analyze strategies in three rapidly growing fields of the IT industry and identify best practices of leading companies in these niches. The study presents the highlights of the competitive strategies of leading international companies in these industries, using which modern companies in these fields can improve their competitiveness.

Conclusion

This bachelor's thesis was focused on creating a contemporary competitive strategy in the international segments of e-retailing, sharing economy, and streaming video sectors. Since these areas are rapidly growing, the development of a competitive strategy is one of the key factors in the success of a company.

The first chapter of the study presented the analysis of theoretical aspects of creating competitive strategies by studying the fundamental scientific literature. Also, the specifics of strategies in international companies were studied and their specifics in the IT industry were described.

The second section of this thesis is a research part of extensive analytical work focused on the main components of successful competitive strategies of international companies in the industries of e-retail, sharing economy, and streaming video services. Best practices of leading companies with different business models and industry positions were analyzed, particularly Amazon, Walmart, Alibaba, Airbnb, Uber, Netflix, and The Walt Disney Company. In this part, the various components of these companies' competitive strategies were scrutinized and the main trends in their development were identified.

The last section of this paper reflects the results of the research and presents a selection of best practices in the competitive strategies of the companies reviewed. The groups of highlights are formed for different types of companies from each industry considered and should be selected by other firms according to their characteristics - industry, market position, and specific resources.

Therefore, during the research, its objectives and purpose were achieved. The results obtained could be applied by the business to form an international competitive strategy in the analyzed industries.

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