Lessons From Netflix: Mopping up with Bounty, the Qwikster Flixter-Upper

OK, I can’t resist a pun. I don’t know how many of you remember the ads for Bounty paper towels, “the quicker picker-upper.” Big spills in the kitchen, oh my! Bounty to the rescue to mop up the mess in a pre-internet minute.

Which brings us to Netflix applying some virtual paper towels to mop up its Qwikster mess–the customer backlash that resulted when Netflix announced that it was going to split its by-mail and streaming movie delivery services into two separate companies. Netflix “classic” (by mail) was to be renamed Qwikster, and the streaming service would assume the Netflix name. This was on the heels of a previously announced price increase, and members were seething–and many were dropping the service.

Price wasn’t the only issue. The two services wouldn’t be talking to each other–maaning separate billings, and customer movie recommendations that wouldn’t cross channels, as two examples. But Netflix quickly scrapped the notion of a separate Qwikster this week in response to customer reaction. CEO Reed Hastings blogged, “It is clear that for many of our members two websites would make things more difficult, so we are going to keep Netflix as one place to go for streaming and DVDs.” That quick reversal, mopping up some mess with some virtual Bounty towels, might be called the Qwikster Flixter-Upper.

The lessons here:

Beware the wrath of the social media. This isn’t exactly news to anyone, but it’s a good reminder. Angry reaction to Netflix’s move was more than viral–it was purely a demonstration of what COLLOQUY calls Madvocacy (more on that topic here). On the other hand, simply consider the power of the consumer in general. Public reaction to New Coke doomed that product, which had a lifespan about equal to that of Qwikster, long before the days of social media.

Find out what customers want. I don’t know how much testing or customer polling was done during the development of the Qwikster concept, but it’s difficult to believe that focus groups, for instance, would have been in favor of a move that eventually caused such public consumer backlash.

Communicate change well in advance, and communicate it well. As Wired reported post-announcement and pre-reversal, “Hastings also apologized to customers for Netflix’s lack of clear communication with its customers regarding the split. ‘It is clear from the feedback over the past two months that many members felt we lacked respect and humility in the way we announced the separation of DVD and streaming, and the price changes,’ Hasting writes. ‘I messed up.’”

Consolidate channels; don’t turn them into walled lanes. Customers want to be treated equally no matter the form of the touch point they choose in order to do business with you–or to give you feedback. That’s why I’ve always puzzled over retailers that give special deals for making online purchases, deals that they don’t match in the store. Yes, I know those retailers are trying to steer customers to a more efficient channel, but it’s up to the customer to decide which channel is more useful to them in any given situation.

As for me, I’m going to check if any of those Bounty commercials are available via Netflix.