Graduation Year

Spring 2011

Document Type

Open Access Senior Thesis

Degree Name

Bachelor of Arts



Reader 1

Darren Filson

Terms of Use & License Information

Terms of Use for work posted in Scholarship@Claremont.

Rights Information

© 2011 Andrew Jordan


Blockbuster and Netflix are two firms in the home video rental market that experienced vastly different outcomes. Netflix vastly increased its firm value while Blockbuster lost its dominant market position and slid into bankruptcy. This paper examines the strategies pursued by Blockbuster and Netflix and the impact these strategies had on firm value. This paper finds that on average Blockbuster’s strategies did not have a significant impact on its firm value while Netflix’s strategies increased its firm value. Specifically, Netflix’s strategies in the areas of service improvement and promotional activity created the most value. The strategies each firm pursued in product line expansion provided value for Blockbuster but reduced value for Netflix.