So Netflix hiked rates today, and people are upset.
I don’t get it. Why the angst? I looked, and as far as I can tell, it’s not a big deal – I’m finally getting charged a pittance for something I value highly.
Bear in mind, I signed up for Netflix back in 2002, and have had a 3-disc-at-a-time subscription the whole time. It’s $19.99, which is less than two premium margaritas at Don Pablo’s. On the other hand, I’ve had times when I’ve had a disc out for 3 months because I keep not making time to watch TV. When they introduced streaming as a free feature, I suddenly was getting ten times the value for my subscription. Taking the rate up to $23.99 for the same deal seems reasonable to me. If anything, I’ll drop the disc subscription (which I’m sure Netflix is just fine with, since they’re getting out of physical distribution as fast as they can) and actually save money.
It seems odd, though. Didn’t Netflix do focus tests? Did they leave out the nerds or something? I mean, your target market is “people who use the Internet a lot,” which means they have a disproportionate reach to their size, and the ability to create flash crowds with things like trending on Twitter. Even a small percentage of people who are really pissed off can make the story “people are angry about Netflix price hike” instead of the more desirable “Netflix clarifies pricing plans, increasing customer choice”.
I’ve met some of the Netflix people, (on the data and API side, not marketing), and they are smart, capable people. Clearly, though, somebody missed the key message that needed to go out. From the NYT article:
What cost $10 a month — online streams of movies plus one DVD by mail at a time — will now cost $16 a month, the company said…
No no no! The message you wanted to get out was “This is a 20% price cut on our most essential service.” Unlimited streaming for $8 a month? That’s a *great* offer.
Swing and a miss right there. Dig that back foot in, and watch it all the way to the bat next time. You’ll get ’em.