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How Many Do-Overs Should a Company Get?

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TaimoorZ
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Supply Network Guru
Re: Netflix fiasco
TaimoorZ   10/11/2011 5:51:14 PM
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"..the subscription hike would presumably finance the execution of this plan"

How many companies have you heard of that double it's product prices to raise funds for a new project or expansion? There are several ways of raising finance but you can't simply double your prices in one go. I don't think the initial strategy was any good unless they offered the customers additional features or options on their subscriptions. And to revert it back with customers paying double the amount and getting the same services as before, seems absolute nonsense.

Barbara Jorgensen
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Blogger
Re: How many do-overs?
Barbara Jorgensen   10/11/2011 5:01:05 PM
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Good points, all, and as I said, $8 is not a lot to pay in the grand scheme of things. NetFlix, however, did not "correct" anything -- their path took them back to where they started. If they had called the rate hike what it was -- a rate hike -- and didn't try to justify it by splitting the businesses -- and then reverse the split -- they would be exactly where they wanted to be without all the fuss. Most people understand rate hikes -- we don't like them -- but if we like a service we pay up. I think NetFlix created a lot of bad will where it could have been avoided and gotten the extra $4 anyway.

As for correcting a mistake when it can be corrected...I admit I have two different perspecitives when it comes to business and sports. I'll have to think on that a bit more...

William K.
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Production Synthesizer
How many do-overs?
William K.   10/11/2011 4:33:55 PM
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What is the big deal about Netflix raising their prices? The price of everything else gets raised and we have no warning, no explanation, and no choice. Comcast routinely bumps the price up. Prices go up whenever there is insufficient competition to keep them down, or, like the oil companies, when they all agree to raise prices at the same time.

As for "how many do-overs does a company get?", why hold anybody to a wrong choice when they attempt to correct it? What is wrong with allowing some organization to correct an error when they find one? Microsoft has been doing it for years, and charging folks a premium for their corrections as well. 

REgarding the option of an official being able to change an incorrect call in football, when have we ever seen or heard of an all-seeing and totally infallible referee? Of course, some errors and incorrect calls may not be challenged, and some challenges may be unfounded, but does that make enforcing an erronious call the best choice? Why in this world should anybody be forced to accept somebody else's mistake when the option of correcting that mistake is available?

saranyatil
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Supply Network Guru
Do - over
saranyatil   10/11/2011 7:41:19 AM
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Where does this leave Netflix subscribers?

I would have cancelled my subscription, thankgod i have not availed any membership with them. It is really a wrong idea to increase the rates with out any intimation this is not the way you treat your subscribers.

This will definitely deplete new subcribers enrolling and to come back will take a long time.

jbond
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Supply Network Guru
re:
jbond   10/11/2011 7:23:08 AM
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The biggest problem Netflix is going to have to face is responding to the price hike. It's understandable when companies hike prices due to circumstances out of their control like; fuel prices, energy costs, labor costs, and many others, but Netflix raised the prices in order to raise capital to grow their business. Now that they're not going that route, reasonable people will be asking "why haven't the prices dropped back to previous amounts?"

I'm not a subscriber and never have been, but I would think Netflix needs to answer these lingering questions before they risk losing even more customers and their stocks drop even more. 

Jacob
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Supply Network Guru
Re: Netflix fiasco
Jacob   10/11/2011 5:44:37 AM
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1 saves

“Most people understand that it costs money to restructure a business”

For doing business money is required, but the company has to find out a suitable VC or other source for investing capital. They cannot expect that their investment can be collected through subscriptions. Subscribers are NOT foolish peoples like Netflix CEO.

Ariella
User Rank
Supply Network Guru
Netflix fiasco
Ariella   10/10/2011 4:45:01 PM
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Giving up the Qwikster idea is not helping it rebound. But it is possible that in time customers will forgive the company.



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