You didn't pay attention to my original post. I would have been happy to pay Netflix $14.99/month for their 2-out plan, if they would have given me that option. Yes, that's more expensive than Walmart, and I would have been happy to pay it.
And, you are absolutely right, there are other considerations than price when choosing products or services. A good example is flexibility. Netflix should offer their loyal customers with more flexible subscribtion plans BEFORE they offer them to new customers, not alienate their existing base by denying them access to these plans. This is a sure way to insult me and lose my business.
Since you make some good points about pricing and marketing, I'm sure you're already aware of the well known fact that consumers report only positive experiences to a few people, but negative ones to everyone. And also that word-of-mouth for services like Netflix is very important. Another fact, and I don't remember the research numbers at the moment, but losing existing customers cuts
hugely into long-term profits for a firm. And therefore, it's a good metric of long-term durability of a company.
So Netflix loses both on price and flexibility here. What is left for them as a competitive advantage? Selection and delivery time. They do appear to have a better selection of titles, but right now it doesn't appear to be so great that the service is useless. About Netflix's current delivery times I can't say. But Walmart is no worse than Netflix was when I had it before. And I'm not going to stand for that kind of insult.
Except in this case, there is a free lunch: Walmart.
Come on, if your competition is offering a better price (all other things being equal), even if only for a limited time, then you have to match it also for that time. This is not like I was an ongoing Netflix customer, heard about their promotion, quit the service and tried to re-subscribe just to get the better price. I hadn't been a customer for almost 2 years. For all intents and purposes, I am a new customer (a lot can change in the business world in two years).
Can you imagine an airline price war in which Delta cuts its rates and United refuses to match their price because I've bought a ticket from them before? There is really nothing different about this situation.
Tell me something, is it rational for me, as a consumer, to choose Netflix's higher price because
Walmart's offer is only for a limited time? Obviously not.
The net effect for Netflix is that they are making $0 in profit from me, and Walmart is. This is just plain stupid business practice for Netflix. They deserve to die.
So what if they are original or not? Competitive free markets are the essence of capitalism, and the reason you can rent DVDs cheaply at all, whether through the mail or from a brick-and-mortar.
Besides, it is well known that innovators seldomly end up being dominant in the markets they created. They can never compete with the marketing and sales channels of large, established firms.
After returning from being abroad for a year and a half, I decided to restart my Netflix subscription, especially since they now have a $14.99/month, 2-out plan, which is more suited to the amount of time I have to watch movies. But I soon discovered that this price is only available to "new customers". I called them up and told them that I could get the same plan from Walmart for cheaper, $12.97/month to be exact. It just didn't seem to get through to them that I don't give an f*cking damn whether they consider me a new customer or not. So much for brand loyalty. So they would rather make no money from me than less money? Fine, I signed up with Walmart.
So far, Walmart is OK - mail turn-arounds are not so fast, but about the same as Netflix was when I had it before (Netflix claims to have improved this now). The selection of obscure titles and foreign flicks is not as good, but still respectable.
Companies need to view their interface with their customers like an API - customers are going to be interested in a few parameters like price, quality of service or products, etc. The rest are totally irrelevant - for example, a company's internal profit models and metrics, whether they consider me a new or old (thus, exploitable) customer, etc. In fact, once a company has exposed the internals of its "API", they've already lost me as a customer. I could care less about all of that, and I won't deal with such companies.
Netflix deserves to die. I'm usually for the little guy, but in this case, we're just dealing with shear stupidity and Darwinian dynamics. Walmart is a formidable opponent even for competent competition. Netflix obviously is not. They are going to get slaughtered.
Now that SHA-1 has been broken, there is another alternative besides SHA-256 and SHA-512 that the crypto experts forgot to mention: AYATOLLAH-1, a hash algorithm with fundamentalist fervor that shall beat back attempts to break it with fire and jihad.
Slashdot Mirror
And, you are absolutely right, there are other considerations than price when choosing products or services. A good example is flexibility. Netflix should offer their loyal customers with more flexible subscribtion plans BEFORE they offer them to new customers, not alienate their existing base by denying them access to these plans. This is a sure way to insult me and lose my business.
Since you make some good points about pricing and marketing, I'm sure you're already aware of the well known fact that consumers report only positive experiences to a few people, but negative ones to everyone. And also that word-of-mouth for services like Netflix is very important. Another fact, and I don't remember the research numbers at the moment, but losing existing customers cuts hugely into long-term profits for a firm. And therefore, it's a good metric of long-term durability of a company.
So Netflix loses both on price and flexibility here. What is left for them as a competitive advantage? Selection and delivery time. They do appear to have a better selection of titles, but right now it doesn't appear to be so great that the service is useless. About Netflix's current delivery times I can't say. But Walmart is no worse than Netflix was when I had it before. And I'm not going to stand for that kind of insult.
Come on, if your competition is offering a better price (all other things being equal), even if only for a limited time, then you have to match it also for that time. This is not like I was an ongoing Netflix customer, heard about their promotion, quit the service and tried to re-subscribe just to get the better price. I hadn't been a customer for almost 2 years. For all intents and purposes, I am a new customer (a lot can change in the business world in two years).
Can you imagine an airline price war in which Delta cuts its rates and United refuses to match their price because I've bought a ticket from them before? There is really nothing different about this situation.
Tell me something, is it rational for me, as a consumer, to choose Netflix's higher price because Walmart's offer is only for a limited time? Obviously not. The net effect for Netflix is that they are making $0 in profit from me, and Walmart is. This is just plain stupid business practice for Netflix. They deserve to die.
Besides, it is well known that innovators seldomly end up being dominant in the markets they created. They can never compete with the marketing and sales channels of large, established firms.
So far, Walmart is OK - mail turn-arounds are not so fast, but about the same as Netflix was when I had it before (Netflix claims to have improved this now). The selection of obscure titles and foreign flicks is not as good, but still respectable.
Companies need to view their interface with their customers like an API - customers are going to be interested in a few parameters like price, quality of service or products, etc. The rest are totally irrelevant - for example, a company's internal profit models and metrics, whether they consider me a new or old (thus, exploitable) customer, etc. In fact, once a company has exposed the internals of its "API", they've already lost me as a customer. I could care less about all of that, and I won't deal with such companies.
Netflix deserves to die. I'm usually for the little guy, but in this case, we're just dealing with shear stupidity and Darwinian dynamics. Walmart is a formidable opponent even for competent competition. Netflix obviously is not. They are going to get slaughtered.
Now that SHA-1 has been broken, there is another alternative besides SHA-256 and SHA-512 that the crypto experts forgot to mention: AYATOLLAH-1, a hash algorithm with fundamentalist fervor that shall beat back attempts to break it with fire and jihad.