Thank you Netflix, a.k.a. the company who kicked the hornet's nest! After all, it's not every day the Internet gives us such a great case study illustrating both the potential and
limitations of social media as a tool for interacting with, and attempting to shape or at least placate, public opinion. But Netflix has done that with its 60% price hike, which has not been, um,
well-received, to put it mildly. The big question is: how does Netflix handle the social media explosion?
Responding effectively to public dissatisfaction is especially challenging for
Netflix because it will be largely a rhetorical exercise -- persuasion, conciliation, call it what you will. Netflix had to know that subscribers would take exception to a big price hike, coming as
it did amid continuing economic woes and growing consumer "fee fatigue." And since the company proceeded with price hike anyway, I'm guessing it already took all this into account and
isn't going to back down.
All that's left to do, in this case, is to attempt to explain why the price hike is necessary and persuade subscribers that it's still worth holding
on to their subscriptions. In other words, Netflix can't use some of the most effective customer service/PR tools, like offering freebies, which are great for making problems go away on social
media.
And they do have a problem: as of this morning there are over 10,000 posts on the Netflix blog and 29,000 posts on its Facebook wall lambasting the company for "gouging"
its customers. Here's a representative (if unusually pithy) one: "Dear netflix: Fuck you." Another opines: "Netflix is just one more example of the greed that is
killing our country." Many comments urge other subscribers to try alternatives like Apple, Amazon and Hulu.com.
In short, it is a perfect social media storm: when your customers are
using your company's own social media profiles to recommend competitors, amid an online tornado of profanity and bitter invective, it's safe to say you done screwed up. I look forward to
seeing how Netflix handles it.