Netflix Increasing Their Prices – Need to Learn from Verizon!

So Netflix just sent me this email. They try to make it sound like somehow it’s all a great thing. And it would be if only their streaming service offered a whole lot more movies and other content that I’m currently forced to get in the mail, via DVD. As it is, all this means is now instead of paying $15/month, I’ve got to pay $20/month! That sucks. That’s roughly an extra $60/year.

Now I’m not always pleased with Verizon Wireless, and they really need realize that a data plan is a data plan. If someone pays $30/month for 2GB of data, they shouldn’t have to pay another $20/month to get tethering & another 2GB. 2GB is 2GB, you should be able to use it however you wish! However, in this case Netflix should take a page from Verizon’s book. When Verizon switched to these new limited data plans, they let all those of us who had unlimited data for $30/month, keep our unlimited at the same price. And we can continue to keep it, for the forseable future, in spite of upgrades, etc.

That’s what Netflix should have done: “going forward any new clients will need to choose from these new plans, but all you faithful customers who’ve made Netflix one of the great consumer media providers and a hugely successful company, you can just keep the great prices we’ve been giving you.”

The lesson: as Seth Godin pointed, out show your best customers you appreciate them. They’re 1) much cheaper to keep as customers by doing something like this, than spending tons of marketing dollars to get new customers, and 2) do a lot of marketing for you by telling everyone how much they love you, if you treat them right.

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