Netflix, What are you Doing
With the announcement of Netflix’s third quarter numbers,
investors are liquidating its stock as quickly as possible. The announcement
stated that Netflix would be splitting the DVD and streaming package, which has
caused ripples of detest throughout Netflix nation. With the separation of
amenities was a price increase for consumers; Netflix customers have decided to
take a stand. With the announcement of losing 800,000 subscribers this quarter,
preceding a quarter with loss in users, stockholders are very concerned. The
article discusses the current state of the company and steps that will be taken
to help get some of the customers back.
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| (Rosoff, 2011) |
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| (Netflix System Breakdown, 2011) |
In class we discussed the five stages of adoption, Netflix does a wonderful job of promoting themselves and they are exceptional at providing free promotions to draw in new users, which provides knowledge about what he company does. Countless times they have sent email promotions that allow users to receive a month free for Netflix. This is a great way from Netflix to spread knowledge about their product and then persuade new users to consume their product. Their vast library of movies and TV shows is not available anywhere else. This mastery of promoting and persuasion has worked wonders in boosting their user numbers. With the new changes, increase in price and DVD-streaming separation, they are causing consumers, both current and potential, to turn away during the third stage of adoption, accept or reject. The best part about Netflix was the availability of their library at your fingertips and the affordable price but things have changed now with their newfound popularity. Who are we to blame them for wanting to make more money? It would have been nice if they did it without passing the new cost onto longtime Netflix users. The article does a wonderful job of showing many different statistics on how Netflix is still a great company to invest in. What Netflix is missing is that users do not care about the stocks; they only care about the service. Right now the service is not acceptable to longtime users, it is time for Netflix to swallow their pride and go back to consoling user satisfaction instead of profits to guide their decisions.
Citation:
Edwards, C.
(2011, October 25). Netflix declines most since 2004 after losing 800,000 u.s.
subscribers. Bloomberg, Retrieved from http://www.bloomberg.com/news/2011-10-25/netflix-declines-most-since-2004-after-losing-800-000-u-s-subscribers.html
Netflix system
breakdown. October 25, 2011. From: http://www.google.com/imgres?imgurl=http://www.review-hddvds.com/images/netflix-promo2.jpg&imgrefurl=http://www.review-hddvds.com/&usg=__ycPHeOBmsjiK4fpG-S0hldp7qF0=&h=326&w=763&sz=79&hl=en&start=53&zoom=1&tbnid=6rZOu-yi0LKZHM:&tbnh=61&tbnw=142&ei=UVaoTu2TIabgsQKW3uG9Dw&prev=/search%3Fq%3Dnetflix%26start%3D42%26um%3D1%26hl%3Den%26client%3Dsafari%26sa%3DN%26rls%3Den%26tbm%3Disch&um=1&itbs=1
Rosoff, M. 2011.
Netflix adds less than 2 million subscribers this quarter, October 25,2011,
from: http://articles.businessinsider.com/2011-07-25/tech/29999690_1_netflix-q3-twitter
I found this article and your review of it to be fantastic! I completely agree with everything you had stated. I am a Netflix member and was definitely upset over their decision to up their prices for current members. I understand that companies have to find new ways to make their money, but Netflix came off very greedy. I have respect for the companies who show support for those loyal to their company. For example it would’ve been great if Netflix had kept plans the same for members who have invested time and money to their company and would let the newer members pay for the newer prices. Overall great look into how Netflix is doing since their new rule arrangements, and thus I am still a member because nothing else out there is quite like Netflix.
ReplyDeleteI found this article to be very interesting and helpful. Netflix is definitely making a mistake by raising their prices and deterring many of their faithful customers away. It's interesting to see how they reported a rise in income when so many people dropped their services because of the increase in price. Netflix was something new to all of us when it become released to the public and could have created a monopoly over it's industry, however now others such as Blockbuster will see a big increase in subscribers as people are just fed up with the way Netflix treats their customers. I had Netflix for awhile but when they raised the monthly price it became too expensive to have as a luxury item and I canceled it. It's interesting to consider the five stages of adoption for Netflix due to the progress it was making and seemed to be headed to the laggard stage, but now seems to be regressing after the most recent price jump.
ReplyDeleteI like the part about the 5 stages of adoption for Netflix. It really incorporates class into a real world situation. Even though most people did accept Netflix at first consumers are now ditching the service. Netflix had the perfect system in place, 7 dollars a month for movies and show streaming. This was the greatest thing ever. So many shows are on Netflix and consumers, like me, would just spend hours watching and using Netflix. I would watch my favorite childhood shows, like Hey Arnold, and loved it. Netflix was the greatest thing ever. Then the company got greedy and demanded more money for more profit. This caused the Netflix nation to go into an uproar and eventually unsubscribe from the service. Can Netflix get those consumers back? Only time will tell.
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