It’s old news now. Netflix is changing its pricing structure. Well, it’s raising prices. OK, “raising" wasn’t actually the word used.
This was announced on July 12, more than two weeks ago. So, why am I writing about this now? Because Netflix is a great example of how to use social media to damage your own brand.
Let me start with the email sent out on July 12: Netflix announced that it would be “separating [its] unlimited streaming plan from [its] DVD plan offerings." In other words, it wasn’t a price increase; you just had to ... ummm ... pay more money for the same service.
Wouldn’t you know it, people were pissed. And its not Netflix’s first price hike of the year.
Let me use my subscription as an illustration. I have the Three DVD and Unlimited Streaming plan. Back in January (yes, 2011), my rates went from $16.99 to $19.99. OK. Three dollars. Prices go up.
Then, a few months later, the email comes:
Your current $19.99 a month membership for unlimited streaming and unlimited DVDs will be split into 2 distinct plans:
- Plan 1: Unlimited Streaming (no DVDs) for $7.99 a month
- Plan 2: Unlimited DVDs, 3 out at-a-time (no streaming) for $15.99 a month
Your price for getting both of these plans will be $23.98 a month ($7.99 + $15.99).
$16.99 to $23.98 in less seven months, that’s a 41% — lets call it what it is — price increase.
In addition to announcing this by email, it did the same on its Facebook page, with no effort to explain the reasoning behind the change. People were pissed. Go figure.
On July 12, angry posts were coming in faster than I could count, and over on Twitter, “Dear Netflix" was trending (and those weren’t love tweets). As I write, the Facebook post has received 81,187 angry responses to the announcement.