Thursday, September 22, 2011

Our own worst enemy

A friend recently asked me if I was going to post something on my blog about Nextflix's woes. I'm not sure I have anything to add that hasn't already been said about one of the greatest marketing disasters since New Coke. Even if Nextflix can pull out of its tailspin, its recent management and PR blunders are going to be the stuff of business school textbooks for decades.

But can we at least talk for a moment about the ridiculous name of its direct-mail DVD service, Qwikster? I immediately thought of Napster and Friendster, ahead of their time like Netflix and now confined to the dustbin of Internet history. Who are the ad wizards who came up with this one?

As amusing and perplexing as Netflix's freefall has been, for those of us who work in PR and marketing, it's actually a rather scary proposition. If these guys can screw the pooch like this, then any of us can. Disaster always lurks right around the corner. Don't get me wrong -- we're all responsible for our own ideas, good and bad. But everyone crosses the street without looking both ways once in a while. Every so often we all drift into the next lane without checking our side-view mirror. 

If we're lucky, we swerve back just in time to avoid being smashed by the oncoming SUV, blaring its horn at us. That's why we collaborate, that's why we brainstorm. There comes a time when each of us needs someone to save us from ourselves.


JennE said...

This was a HUGE topic of discussion in my marketing class this week. The whole thing is awful, but I'm most interested in seeing how N*/Q*'s competitors run with their faux pas. This is a TREMENDOUS opportunity for them to step in, but they will need to act quickly in order for it to be effective.

I just fail to see how they EVER thought this was a good plan, however. I think the figure I saw showed their stock dropping from $307 a share in july down to $147 this week and they have already lost over 1 million customers since the announcement in July. I'd be curious how many, like me, stayed a member yet simply removed one of the services and settled for only streaming or only mail deliveries after that change resulting in less consumer dollars spent as well?

Very curious how this will continue to play out.

Jonathan Potts said...

You may recall that after Coke backtracked and re-introduced "Coca-Cola Classic", Pepsi ran a commercial making fun of the fact that the new Coke was the old Coke, and the New Coke was now the old Coke, etc. Coke, of course, had built a lot more brand equity than Pepsi, and once it recaptured its customers with Coke Classic, it could quietly allow New Coke to die.

The thing about Netflix is that I bet a lot of people, even before all their blunders, weren't getting their money's worth out of the service. They were probably watching one or two DVDs a month but paying for a lot more. So if I'm Red Box I drive home its pay-as-you-go system. If I'm Blockbuster, I remind people that I still exist, and that I offer the best of both worlds: a direct-mail service that can be combined with in-store returns and rentals.