Customers Don’t Like Paying More for Netflix

Netflix customers are on the Internet raising hell because prices are jumping (60 percent, by The New York Times’ calculations) starting September 1.

According to VP of marketing, Jessie Becker, the company has noticed a demand for DVDs since November when the company announced an $8 streaming service with an additional DVD option for $2.  According to the email I received from Netflix, “We are separating unlimited DVDs by mail and unlimited streaming into two separate plans to better reflect the costs of each.”

Customers aren’t only balking at the price increase. Since they’re being asked to pay more, now they’re also angry about the dearth of new releases among the streaming options. We can’t wait one more second to watch Little Fockers on the tee vee!!

As of about 12:15 p.m. ET, the post on The Netflix Blog announcing the change has nearly 7,000 comments. Commenters are reacting both rationally (questioning the value attached to these new prices, for example) and irrationally (calling it “a load of shit” and comparing the streaming option to the “measly orange slice” that comes with a bacon and egg breakfast meal, also for example).  Of course, Twitter is also seeing a lot of action.

While the company might actually need to raise prices to be profitable, here’s a case where Becker and others on the marketing and PR team might have wanted to take a close look how they could make this pill easier for consumers to swallow. Right now, it simply sounds like a big company wants to make more money and customers have to pay. And raising prices after a jobs report that shows things are still tough out there for consumers wasn’t going to be easy. But raising prices without raising the level of your offerings would be difficult even if the economy was in better shape.