For the past few days I’ve been aching to write about the disaster that is Netflix.
I cannot remember the last time a company has annoyed me as much as Netflix has. They have managed to do everything wrong in a very short amount of time. The Netflix disaster is a perfect example of what not to do when your business model is working. I foresee this will most definitely be used as a case study in marketing classes.
As a former customer of Netflix, paying $10 a month was not a bad deal, though I would have much rather them provide a newer movie selection with streaming capabilities. I know of many people who share the same sentiment and working on this problem would have made perfect sense. Netflix, however, decides to do the #1 worst thing that a company can do – ignore the needs and wants of their customers. What do they do instead? Increase their plan by 60% with no increased service value to customers.
Netflix was the premier leader in the instant streaming/DVD industry. One huge mistake followed by many other stupid mistakes and that little red vending machine touch screen box that is Red Box is looking pretty enticing. I was only interested in Netflix because of the movie option, but one night with Red Box and I was left wondering why I paid $10 a month when I could never find a movie available to stream or have mailed to me. It’s safe to say, I’ve found a new movie home with Red Box. With $1 per movie per night, you can’t go wrong. They are definitely all about creating a good user experience.
Here’s a list of things that Red box is doing right: (Netflix please take note.)
- Understanding of supply & demand
- Fulfilling the needs & wants of their target market
- Better than the competition
- Price Friendly
- Free movie offer after signing up = shows appreciation
- Good customer service
- Easy to use
- Easy to return
= Great User Experience!
Here’s a look at the impact of Netflix’s 60 % price hike:
- Loss of 1 million customers in the first week of price hike
- Stock dropped 19% in one day & was down $39.50 in after hours trading
- Loss of $2 billion in value and counting
- Feedback of CEO Reed Hasting’s blog post aka fake apology had a 73% negative feedback
- Manage to anger just about everyone
Now, let’s talk about the fake apology from the CEO of Netflix, Mr. Reed Hastings. As if angering just about everyone with an instant streaming device wasn’t bad enough, Hastings has written one of the worst apologies I’ve ever read. You want to ask your customers to come back, but you create absolutely no goodwill? It’s kinda like when you were young and your younger sibling would kick you under the dinner table and then say sorry just because your parents made him/her say it, and then two minutes later you get kicked again. Feel my sentiment? And, yes I have younger siblings, and I don’t like getting kicked. To top everything off Hastings introduces the new DVD only plan by Netflix–Qwikster?! Worst idea ever! Now we have to manage two separate websites with two separate catalogs and two completely different queues. Not only did they not improve their user experience but they made it worse. In fact, Netflix has lost all value to me.
This whole Netflix disaster is an unnecessary shift in brand and the miscalculation is proving to be devastating. Now, here’s the icing on the cake. If you’re a Tweep and you’ve visited the Qwikster Twitter account (at the time this post was written) you will NOT find the DVD rental company Qwikster, but rather a foul-mouthed Elmo whose Twitter profile consists of illegal drug usage. As if it couldn’t get any worse, the Qwikster2 Twitter account, which features Bert and Ernie (friends of the Elmo Qwikster) as the profile pic, engaging in none other than illegal drug activity.
Netflix, if you were going to create such a stupid idea as Qwikster, at least have the decency to do your research first. You should have taken care of all aspects of your launch, including making sure that a drugged up Elmo is not the owner of your new Twitter account.
What do you think? Are you just as annoyed with Netflix? Did you cancel your account? Please leave all comments in the box below. As always, thanks for reading. Be sure to share!