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Your role is silent! The debacle of Netflix

October 10, 2011 by Bob Phibbs — CEO, The Retail Doctor

I was one of the original adopters of Netflix. The simplicity of it all! Select the movies you want and they arrived in the mail.

Instead of using a megaphone to scream at people why they needed to have the service, they use the magnet of simplicity and positive word-of-mouth ensued.

I would get an e-mail saying which movie just shipped and when I could expect it. It was all easy, simple, and the drama-free.

In July I received the e-mail that they were going to be raising their fees about 60 percent.

Last month, I received the notorious e-mail from their CEO Reed Hastings. He was rambling about why they had to split the company into two; one for streaming (Netflix) and one for DVDs (Quickster.) It seemed they were going to be charging more for less in a complicated way.

Today I received another e-mail saying it was all a mistake, like the end of "Dallas"' eighth season where Pam woke up to her husband Bobby in the shower to not so subtly tell the audience that the previous season was "all a dream."

It seems odd in the wake of Steve Jobs' death where everyone has been breathlessly saying how Apple made computing easy, that the company that made viewing movies easy could slip so badly.

I get they lost contracts for several big movie companies and that it costs a lot more than they used to for procurement of rights.

However, to pull it back as "we must've misjudged our customers" is the greatest hubris I've heard. (Even more than the #Gaspfail disaster in Australia last week.)

If they truly listened to their customers they'd have found many had failed ranks just from the price increase notice, let alone the rambling e-mail.

My niece said it best last night at dinner when she said, "I'm tired of getting all the e-mails from them. I didn't select them to want to hear from them."

At its heart it's an Internet company. Point and click is silent. The surprise and delight doesn't come from a person but how the product is delivered.

Yet at each turn, Netflix has decided the more information the better but the place they missed is we wanted a silent provider.

I would say that Facebook isn't far behind Netflix with their constantly changing privacy settings and design changes. At some point customers don't want to hear from you or experiment. What they want is consistency and silence.

With all their high drama and counterturns, their brand has been damaged significantly. While many think Amazon Prime could take over Netflix niche, now could be the time when Warner or Paramount could mount their own services and cut out the middleman.

The irony is that previously Hastings had said, "Businesses die all the time from moving too slowly, but not from moving to fast." Too fast and too loud.

One thing's for certain in my book, Hastings is not long at the helm.

What say you?

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