Last night was movie night, I opened the red envelope slid out the DVD and thought once again about what I consider to be the biggest business bumble in the past ten years, maybe ever.
In July when Netflix raised their prices, I thought briefly and occasionally about quitting them and converting into a Redbox junkie, but I never quite got around to it.
Then along came the formal announcement about Qwikster and Reed Hastings, CEO of Netflix, added insult to injury with a pathetic apology and an explanation regarding the split of Netflix services in response to the backlash.
His post did nothing to help me understand why it was better for me, the customer, to manage two separate services, pay twice as much, and receive two entries on my credit card statement; it’s not like I had been lying awake at night wishing they would come up with a new logo for the red envelope. And it made no sense at all when he stated that separating the DVD team off made it possible for them to add video games to their offering. I think the only thing he said that resonated was when he admitted, “In hindsight, I slid into arrogance based upon past success.”
When I first caught wind of it, I thought for sure I had misunderstood; why would Netflix, the company that has been touted for being an innovative and consumer aware organization, do something so anti-customer? The emails I received explaining all of the ‘benefits’ of the change (to Netflix) turned my misunderstanding into a reality.
I realize I could go to the effort of getting things set up so I could download movies or programs directly to my TV, but I really don’t want to and I certainly didn’t want to be forced to. My kids enjoy the instant downloads and watching on their laptop and I love receiving the red envelope in the mail. We had one convenient account, a queue full of movies and I wasn’t happy about having to make a choice between paying more or choosing between DVD’s and streaming.
A few months after the price increase, three weeks after the introduction of Qwikster, and 1 million lost customers later, Reed came to his senses and Netflix rewound. Reed blogged, “it is clear that for many of our members two websites would make things more difficult, so we are going to keep Netflix as one place to go for streaming and DVDs.” I can only say, duh.
What surprises me even more than the Netflix blunder was the lack of response from the competition. What an incredible missed opportunity. From July to October if anyone had made it easy for me to switch, I’d have done it in a heartbeat. With the plethora of information available about all of us out on the great ‘interwebs,’ I’m shocked that no one marketed to me.
I’ve recently started to see Blockbuster ads, but they’re too late. I’m once again content and although I may never have the same respect for the folks that run Netflix, I’m not inclined to switch.
If only Blockbuster (or someone) had made it to the dance a little sooner, it would have been one business bumble, not two.