Last week I wrote about the Netflix’s decision to spin-off its DVD rental business into a separate company called Qwikster. (It’s a week later and I hate the name more than I did when they first announced it). Back then I wrote how Netflix CEO Reed Hastings’ awful video announcement could have and should have been better (as of this writing, the video has 4,600 dislikes vs. 700 likes). As a filmmaker who loves movies, the whole thing has been rather upsetting. But <sigh> I’m coping. I’ll get through this. We’re looking into other resources for getting our movie fix now that Netflix is splitting in two and the experience is going to take a major dive. It occurred to me why this is such a huge mistake for Netflix (in my most humble of opinions).
By spinning off the DVD mail business, Netflix is staking the future of home cinema enjoyment on online delivery. I applaud them for their forward-thinking and in truth I have no doubt eventually that’s where it’s going. But here’s the thing: the Netflix brand is NOT about HOW I get the movies. For me, the Netflix brand was simple: fast and easy access to every movie ever made. Period. THAT’S what they gave me. I didn’t care how they got me those movies (DVD by mail or streaming instantly). I knew that if I wanted a movie to watch, Netflix was the defacto choice. (There was a time when the thought of using anything else other than Netflix would’ve been anathema to me.)
Netflix has now tied their brand to the DELIVERY method instead of the EXPERIENCE and service. They are saying “Netflix” means “streaming movies.” Frankly, I think that’s not a smart move. (Can you tell I’m trying to be diplomatic. I want to say something else, but I’m being reserved. Showing restraint. I’m rather proud of myself.)
So, in addition to Apple, Netflix should take a queue from such companies as Amazon. That company started out being about the largest “bookstore” on the planet, but CEO Jeff Bezos was smart enough to quickly evolve it into so much more (essentially EVERYTHING on the planet). Another great example is Zappos. The Zappos brand is NOT about shoes. It’s about amazing customer service. (I pray for the day Zappos launches an airline!)
What can we learn from all of this? Simple. What is YOUR brand? Is it about pretty imagery? Or is it so much more?
Well said, Ron! For me as well, it was always the experience of Netflix and not the delivery.
I’m still finding it incredulous they think these are good decisions. But, then again, maybe they know something we don’t. They say hindsight is 20-20. Only time will tell.