Tags: netflix

4 Brand Marketing Lessons Learned from Netflix’ Follies

4 Brand Marketing Lessons Learned from Netflix’ Follies

Beyond • November 10, 2011

The DVD rental service Netflix quickly became a household name simply by offering what no other DVD rental store was doing. It turned the business and pleasure of rentals into a convenient transaction that never required your to go past your mailbox or your online account. It made what people do easier and more efficient and there’s no better marketing than that. But the simple principle of “if it ain’t broke don’t fix it” didn’t keep Netflix executives from tampering with what was otherwise a brilliant design. Changes in service and especially pricing caused the company to lose over 800,000 paid subscribers in just one quarter. That’s an astounding loss. While it’s just a dent to them, as they still have over 23 million users, the lost customers should raise red flags. The loss also wasn’t an overnight transition. As an on-again off-again NetFlix user among many others, I know that a sudden SIXTY PERCENT fee hike was too much for many loyal and long-time customers. Here’s what you can learn from what some are calling the first wave of a sinking ship…. 1. Service First, Sales Later Netflix ignored the golden rule of business, and that’s that sales always follow service. If you have good service, you’ll have profits. Tamper with your services and you’ll quickly see plummeting sales. 2. Don’t Ignore Feedback Recently Bank of America tried to implement a $5 monthly fee for all customers who didn’t meet a minimum monthly balance. The move caused uproar and BofA quickly took noticed and decided the money they’d make from the hike wasn’t worth the bad PR. Netflix did just the opposite. They ignored social conversations and the reviews they were receiving in the press. Worse, when they finally got around to addressing it, it was already a dead issue that was forgotten by much of the press and consumers. By resurrecting the proverbial dead horse, they reminded people how much they hated it. 3. Don’t Divide Your Brand Brand marketing is a tough business that takes hard-earned dollars. The larger the company, the more dollars it takes to create brand awareness. And despite the good and bad PR, NetFlix is known for their movie and game rental service. So when they decided to fracture the brand by creating a separate name, Qwikster, for their DVD rental, they unwittingly sent themselves back to the drawing board. The rule here is stick with your brand and do everything you can to bolster it. 4. Respect Your Customer’s Intelligence No one likes being treated like an idiot. But that’s exactly what Netflix did to their customers. Rather than trying to gain sympathy and explain price hikes due to rising cost or any other number of reasons, they instead used a rather transparently manipulative ploy. They acted like they were doing you a favor. Netflix claimed that the price hike was some sort of “convenience” to the customer. Almost a million customers later, we can safely say that it wasn\'t.


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Google Tweaks: Gmail Upgrade & Reader Downgrade

Beyond • October 24, 2011

The news that Google’s Reader is about to have its social features retired caught many not decrying the neutering of a valid service, but asking “What’s Google Reader?” A feed aggregator introduced in 2005 when Facebook was only available on university campuses and Twitter was a twinkle in Jack Dorsey’s eye, Google Reader picked up a (small) number of dedicated users, primarily writers and news junkies who became addicted to the ability to combine all their favorite blogs and news sites into subscriptions to quickly scan through the latest releases. The Share button at the bottom of each post allowed Reader users to share items of interest publicly or to restrict access with sharing groups. If the last phrase struck a chord, it can be confirmed that it is true: Back in the stone axe days of social networking, Google Reader was already embracing the sharing segregation strategies that it incorporated eons later in Google+ Circles. Critical Mass or Critical Condition? When Bill Clinton was running for president, strategist James Carville hung a sign in campaign headquarters that read “It’s the economy, stupid.” If Carville worked in the Googleplex the sign might read “It’s the critical mass, stupid.” Google+ users have now reached 40 million, or at least it’s safe to say that 40 million people were driven into a frenzy by the initial unobtainium of the invitations to join Google+. They had enough time to take a look around, wonder where everybody was, and then leave never to return. Demonstrating that it isn’t just RIM, Netflix and AMD who have the Reverse Midas Touch, Google+ still doesn’t have any business pages. With traffic falling by two thirds and still plummeting, it seems that on the way to critical mass, Google+ seems to have lapsed into critical condition. It’s the Preview, Dense! While Google+ flounders, Google announced that Gmail was getting a redesign so that it would more neatly fit into the current Google aesthetic. The themes tab in Gmail Settings now has two settings for Preview and Preview - Dense (no correlation to Carville’s exhortation), which are present to eventually allow the dynamic expansion of the interface to suit not only the user’s preferences but varying screen sizes as well. Over 5 Years in Beta Even the Official Gmail Blog stated that the new interface has “a few rough edges,” admitting that some Labs features “look a little strange in the new themes,” but they plan to fix them as they go. Google has a habit of moving glacially on the provision of new services. Gmail was an invitation-only beta (ring a bell?) release on April Fool’s Day of 2004, which didn’t graduate to release status until five years and three months later. Although there is no doubt that Gmail turned out to be a rousing success, the jury is still out on Google+, which makes faithful Reader users even more nervous. Should the new social network go the way of Buzz, their favorite aggregator could be left in Googlelimbo. The Big Black Bar Was Rumored to Be a Mourning Armband The big black bar that suddenly appeared at the top of all Google pages a while back was rumored to be a mourning armband for Google’s social media policies, but it turns out that hope still springs eternal in Mountain View, California. It cannot be denied that Google has crafted a unique and comprehensive social network infrastructure. Even though some features such as sharing to a sub-circle separately from its larger circle require a Ph.D. in Googleology to master, Google+ is an extremely capable and sophisticated social network that incorporates the innovation and seamless integration to send Mark Zuckerberg’s creation back to the depths of Harvard from whence it came. Google is marching at its own pace inexorably towards the future, albeit on a quirky path that does not guarantee its domination of every online activity. Anti-monopolists can rejoice in that fact as it seems the only individuals capable of stopping Google from taking over the world are on the Google board.


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Costume Ideas, Google+, BlackBerry, The Weekly Wrap’s Got It All

Beyond • October 21, 2011

Have you decided what you’re going to be for Halloween yet? I may have a last-minute idea for you. Read this edition of the weekly wrap to find out what it is. In Memory of Dennis Ritchie (1941-2011) I can’t be the only one that saw the name Dennis Ritchie trending on Twitter and assumed it was Lionel’s brother. Right? Fine. I was the only one. Sue me (please don’t sue me). If you were as confused as I was and don’t want to admit it, read this post In Memory of Dennis Ritchie (1941-2011). Women in the Workplace: Has the Internet Expanded Opportunity? My mom always said, “If you don’t have anything nice to say, don’t say anything at all.” Luckily, I’m not sexist and can tell you to check out this great post on Women in the Workplace: Has the Internet Expanded Opportunity? Benchmark Email Releases Free Manual on the Entertainment Industry Sadly, it doesn’t cover how to stop making so many knock offs, reboots and super hero movies. Maybe if they did better email marketing they could afford to make better movies. Better check out our Free Manual on the Entertainment Industry. 5 Timeless Marketing Lessons Learned from Steve Jobs #6: It doesn’t matter if you can count in Spanish if your name is Bono. Discover the other 5 Timeless Marketing Lessons Learned from Steve Jobs. DIY Websites: How to Create, Launch and Manage Your Own Site Channel your inner Martha Stewart. No, I don’t mean get involved in insider trading and spend time in jail. I mean learn about DIY Websites: How to Create, Launch and Manage Your Own Site. Netflix Drops Qwikster and Reincorporates DVD Service Sure, it could have been the thousands of other posts skewering Netflix CEO Reed Hastings that caused him to rethink his plan, but I’m going to say it was my take on it that made Netflix Drop Qwikster and Reincorporate DVD Service. Brick Joke: BlackBerry’s Self-Inflicted Tribulations I thought it was a fitting joke that at Steve Jobs\' tribute yesterday, Coldplay dedicated “Fix You” to BlackBerry. Chris Martin wasn’t the only one to tell a Brick Joke: BlackBerry’s Self-Inflicted Tribulations. Support Update: Facebook Integration with Benchmark Email You know the old saying, “If it ain’t broke, don’t fix it?” Well, Facebook broke our integration. You’ll need to reconnect your account to accept their new permissions. Find out how in this Support Update: Facebook Integration with Benchmark Email. Is Google+ Alive or the Walking Dead? So is it going to be this year or next year that someone dresses as Zombie Google+ for Halloween? Find out, Is Google+ Alive or the Walking Dead? iPhone 4S: To Upgrade or Not to Upgrade? The eternal child in me is screaming, “NEW TOYS! I WANT TO PLAY WITH SIRI!!” For now, the party pooper known as my bank account is acting as the voice of reason. Where do you stand on the iPhone 4S: To Upgrade or Not to Upgrade?


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Netflix Drops Qwikster and Reincorporates DVD Service

Beyond • October 18, 2011

Price hikes are never going to garner rave reviews from customers. The decision to split streaming and DVD rental services and charge for each should have been the biggest issue customers had with Netflix. Thanks to some less than tactful PR and a few other missteps from CEO Reed Hastings, the web was abuzz with trash talk. Thankfully, it seems that Netflix has finally gotten it right. In their two month late apology, Netflix announced that they would be splitting their services into Netflix for streaming and Qwikster for DVDs. It would be two separate entities, with two individual web sites that would not work together. Fans that were already upset over price hikes were now also peeved about having to do their movie viewing via two different services. Last week Netflix scrapped those plans. Due to continued negative publicity and angry users, Qwikster has been abandoned. Sure, there will still be two separate charges for streaming and DVDs, but it can all be done in one user friendly space. In another announcement that is sure to delight the now skeptical Netflix users, there will be no further price changes. This is the correct decision that Hastings should have come to two months ago. Scratch that. Hastings should have made that decision before announcing any changes to the world. A billing increase may be unavoidable, but there is a right way and a wrong way to do it. Hastings chose the wrong way. He sent Netflix into a downward spiral of bad publicity. In this economy, a simple (and timely) email explaining the reasoning behind the split in billing, an apology and a thanks for understanding and your continued business probably would have sufficed. Before making your next major change at your company, consider how your customers will react. Weigh the pros and cons, and be sure to address the cons with your customers. Be understanding of their wants and needs. Put out fires before they start, rather than adding fuel to them as Hastings did with Qwikster. Unless you belong to the “any publicity is good publicity” train of thought... If that’s the case, be prepared to be raked over the coals by the unforgiving, almighty Internet.


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The Weekly Wrap Goes Hollywood – (Not Written by Aaron Sorkin)

Beyond • October 17, 2011

Today, October 14, is National Dessert Day! So be sure to grab a bowl of ice cream while reading this edition of the weekly wrap. It’ll burn some mental calories (if that’s a real thing). Beyond Benchmark: Check Us out on Nonprofit Spark Radio! How excited was Jennifer about the things Benchmark Email was participating in lately? Four exclamations points in the first paragraph excited. Five if you include the headline. It’s infectious. That’s why you should read this edition of Beyond Benchmark: Check Us out on Nonprofit Spark Radio! Customize an Email Template for National Dessert Day! If you do one thing on National Dessert Day, it should be to eat a dessert (or four). If you do two things, Customize an Email Template for National Dessert Day! Facebook’s Tracking Cookies Spur Class Action Lawsuit I know what you’re thinking. Mmmmmmm...tracking cookies (I was too). It’s not that kind of cookies. Find out what’s really happening when Facebook’s Tracking Cookies Spur Class Action Lawsuit. Customer Management Tips: Turning Customers into VIP (Part 1) Bust out the red velvet rope. Learn from these Customer Management Tips: Turning Customers into VIP (Part 1). Netflix Partners with Facebook around the World. Except the U.S. If Daft Punk wasn’t stuck it your head upon reading the headline, it will be now. Around the world, around the world. Around the world, around the world. Quick, read about how Netflix Partners with Facebook around the World. Except the U.S. and get it unstuck! How to Apply Specialty TV’s Branding Genius to Your Web Business I watched Pom Wonderful Presents: The Greatest Movie Ever Sold this week. It’s incredibly interesting to see and Morgan Spurlock did a great job making it a fun-to-follow story. If I can’t sell you on how any of that’s riveting, Hal can. That’s why you should check out How to Apply Specialty TV’s branding Genius to Your Web Business. Free PDF: Top 10 Ways to Communicate with Your Twitter Followers Are you Team CoCo? Are you on Twitter? Both reasons to check out my post for this Free PDF: Top 10 Ways to Communicate with Your Twitter Followers. Innovation Management with Brightidea, Jive and Spigit Innovation management sounds as made up to me as social networking manager sounds to my parents. That being said, these companies sound awesome. Learn about Innovation Management with Brightidea, Jive and Spigit. NASA & Foldit Put Science Apps in Users’ Hands NASA is really settling these days. They used to put things on the moon. You’ve changed NASA. You’ve changed. See what happens when NASA & Foldit Put Science Apps in Users’ Hands. How Hollywood Turned $15,000 into $150 Million with Social Media They should make a movie about it, written by Aaron Sorkin. Nobody has had that idea yet. Discover out how How Hollywood Turned $15,000 into $150 Million with Social Media.


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Netflix Partners with Facebook around the World. Except the U.S.

Beyond • October 11, 2011

It was at the 2011 F8 developers conference in San Francisco when Netflix CEO Reed Hastings announced a new partnership with social giant Facebook. In the announcement, Hastings revealed plans for a tight integration that would enable users to share information about the videos they are watching with friends via the social network, or directly through Netflix itself. The integration is set to roll out in 44 of the 45 countries it currently has a presence in. Believe it or not, the United States is the one country that got the shaft - it was not on the list! What’s the Big Idea? So what is standing in the way of the new Netflix-Facebook partnership taking off in the U.S.? An old video privacy law that originally went into effect back in the 80s. That’s right. According to the Video Privacy Protection Act of 1988, information regarding video rentals cannot be disclosed unless the renter provides their consent on a basis of rental by rental. This law, adopted nearly a quarter of a century ago by Congress, instantly stopped Netflix’s plans of integrating with Facebook USA in its tracks. And therein lies the rub. Like almost all botched moves in the marketing world, this one is starting to look like a bad business move on the part of the video rental player. Although the service is expanding its global presence slowly but surely, the United States is its biggest market by far. Netflix itself claims that it currently has more than 25 million members in the United States. This is in comparison to what has been estimated at around one million users in all other countries combined. Not being able to reach its legions of users in the U.S. is a lost opportunity and one that takes a lot of air out of what should be an enormous deal with Facebook. A Helping Hand The Video Privacy Protection Act became official after a video store in the Washington, DC area gave a local reporter the video rental records of Robert Bork, the U.S. District Judge whose nomination into the Supreme Court was rejected by the Senate for unrelated matters. Evolution may be the factor Netflix can leverage to turn the tide in its favor, seeing that there was no web or Facebook back in 1988. Michael Drobac, the company’s director of government affairs, said the law is in need of an update. He also encouraged users to write letters supporting an amendment that would change the law and allow Netflix to share video rental information in the U.S. Luckily for Netflix, it has been able to rally up support from its users, and a few members of Congress, who Drobac called “forward-thinking,” recently introduced a new law that would remove the roadblock and allow the Facebook integration to move forward in the United States. The bill, officially known as H.R. 2471, would essentially call for an opt-in program that gives the user the freedom to decide whether or not they want to share what they are watching with others. Netflix’s history with Facebook raises the question of whether it is really cut out for social media integration. Back in 2004, the service introduced a social feature called “Friends” that allowed members to see what their friends were watching, make suggestions and compare ratings. It pulled the plug on Friends in 2010 after learning that only 2% of members were using it. Earlier this year, Netflix discontinued another feature that allowed users to share movie ratings with friends on Facebook due to lack of usage. The latest integration effort may eventually reach the U.S., but by then, will it be too late?


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Charter Communications’ Email Prefers Rhetoric over Reason

Beyond • May 24, 2011

I received an email campaign from Charter Communications yesterday morning that rubbed me the wrong way. It was for an opportunity to receive a Preferred Customer rate for the next two years. I can see why I would be a preferred customer. I always pay my bills on time and have a few of the various add-on packages. Rewarding your preferred customers is a great idea for an email campaign. Just make sure your customers prefer you before sending one. Otherwise the reaction may be the exact opposite result you sought. The email\'s subject line read: “Don’t Miss Out! Lock in your savings for 2 full years!” The chance to pay less would be great, except I opened the email to find the exact same rate I am currently paying. The rate is already so exorbitantly high that I have considered getting rid of my cable altogether and watching TV and movies online and using Netflix. The savings I was hoping for weren’t exactly the price I already consider too much. Especially since they were asking me to commit to two years to receive their so-called “savings.” Upon closer inspection, the deal they were offering included little more than I currently pay for. It’s tough to feel like you’re being rewarded for being a preferred customer when they try to sweeten the deal with nothing you’re interested in. It’s not saving money when you’re paying for things you don’t want or need. Perhaps that last paragraph was more of a rant based on my distaste for Charter Communications and less on successful (or the lack thereof) email marketing. The reason I decided to bring this up on the blog is simple: Before you decide to reward your customer, make sure it’s a prize they’d like to receive. I felt more mocked by this email than like I was being treated as a preferred customer. It angered me. Polls and surveys are often an underutilized aspect of email marketing. That being said, they’re also an excellent way to gauge how satisfied your subscribers are. That way you can see who is happy with your services and award them accordingly. For the responders that are negative, you can reward them too. Put something together that will rectify their negative feelings toward your company. Then you can effectively reward your subscribers as preferred customers with savings they will appreciate.


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