Posts tagged customers

Choosing How to Serve Your Audience: Target

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Target has a series of smaller City Target stores–although this one in Westwood Village near UCLA doesn’t feel that much smaller–designed for urban customers. I think they’ve done a great job of identifying their market and structuring the store to meet the needs of their audiences. For example, there’s both a street entrance (shown above) and a parking-lot entrance.

So which one is this display closer to, and why?

Netflix: How Not to Communicate with Customers, Part 2

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Bye Bye Netflix
In July, Netflix changed their service dramatically. Lots of people were unhappy, both with the change, and with how it was communicated.

Three months later, Netflix co-founder and CEO Reed Hastings posted an apology on the company’s blog. He also sent a condensed version of that apology to every Netflix customer (well, I got one–I assume everyone else did, too). In it, he says:

But now I see that given the huge changes we have been recently making, I should have personally given a full justification to our members of why we are separating DVD and streaming, and charging for both. It wouldn’t have changed the price increase, but it would have been the right thing to do.

So here is what we are doing and why:

Many members love our DVD service, as I do, because nearly every movie ever made is published on DVD, plus lots of TV series. We want to advertise the breadth of our incredible DVD offering so that as many people as possible know it still exists, and it is a great option for those who want the huge and comprehensive selection on DVD. DVD by mail may not last forever, but we want it to last as long as possible.

I also love our streaming service because it is integrated into my TV, and I can watch anytime I want. The benefits of our streaming service are really quite different from the benefits of DVD by mail. We feel we need to focus on rapid improvement as streaming technology and the market evolve, without having to maintain compatibility with our DVD by mail service.

So we realized that streaming and DVD by mail are becoming two quite different businesses, with very different cost structures, different benefits that need to be marketed differently, and we need to let each grow and operate independently.

Nowhere in this passage, or elsewhere in the apology, does he mention something crucial: the way they’ve been handling streaming has been wrong, and the reorganization is designed to let them keep that part of the business going. Bill Gurley does a great job of explaining how the laws regarding distribution rights for DVDs and streaming video are different.

And I think it’s worth noting that it took three months for them to figure this out. Three months and the loss of what I hear is a million customers–not to mention dwindling stock prices. All that, and an apology that doesn’t really explain the cause of the change (or indicate that they now realize that their method provided very little notice to existing customers).

The response I’ve seen has been overwhelmingly negative, which is not what you usually hope for with an apology.

Photo by ozcast, via Flickr.

Netflix: How Not to Communicate with Customers

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I am one of the Netflix customers who opened an e-mail titled “Important Netflix Account Info: Price Change and New Plans” to find that Netflix will soon be charging me more.

I’ve been a Netflix customer for many years, and have always been happy with the service. And I’ve had a number of subscription plans during that time, based on my viewing patterns.

Here’s the thing I noticed: Yes, Netflix is about to charge me $19.99 a month instead of $14.99 a month. And, yes, that’s a third again as much for the same service. Also, yes, it is only $5 a month–hardly likely to break the bank. But–and this is to me a bigger deal than the cost–previously, I have been able to continue whatever plan I was on until I chose to make a change. That plan was grandfathered in, and while new customers might not be able to select it, I could continue with it because I was already subscribed.

That’s not the case here. Netflix has made this change across the board, regardless of whether you are a new or an existing customer. And they’ve done it with fairly short notice; the new pricing will take effect starting September 1, and this is the middle of July. Considering that it’s summer, and people are at various stages of vacations (assuming they’re not moving), that doesn’t feel like a lot of time to me.

It feels like even less time when I click through the e-mail to change my subscription and find that the new plan will actually take effect next week. And the confusion continues when I see that one page tells me to return my current DVDs within seven days, and another tells me within 14 days. Come on, Netflix–make up your mind. What are these time frames, and why can’t you communicate them consistently within the same information stream?

Nevertheless, I’ve changed my subscription. We’ve had two DVDs for months, because we haven’t had the opportunity to watch them. So, clearly, we don’t need X number of DVDs per month. Streaming video is the way to go for this. If we really want a DVD, we can rent from Redbox.

So here’s the real question: Is it worth paying for Netflix at all when I already have a membership in Amazon Prime?

That Isn’t Your Only Audience

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You probably know who your customers are. You know where they live, how old they are, what they buy, and how much education they have.

But what about your co-workers? Your internal audience is key to any success, because they represent you. If you want your customers to see you as an organization that provides great service, then your employees have to want to provide that service.

It’s not enough to pay them for it, or to tell them that they need to. You have to get them to believe that it’s important. And that means letting them know why their actions matter.

You can’t provide great customer service if there’s internal infighting. Truly great customer service draws on internal resources, and infighting means that no one wants to help anyone else. What you want is an organization of people who support each other, and then extend that to the outside world.

So how do you do this? Start by sharing. Knowledge is power, but it’s power that grows through the sharing process. If you keep it to yourself, you’re being greedy and you’re hurting the organization. Give people the information they need to do their jobs, understand organizational goals and priorities, and feel proud of who you are and what they do. Trust me, the vast majority of life is not on a “need-to-know” basis, and most of your secrets don’t need to be secret.

Open up the blinds and let the sun in. You’ll be amazed at how much more everyone can see.

Photo by .digitale, via Flickr.

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