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Old July 15 2011, 09:44 PM   #149
Temis the Vorta
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Location: Tatoinne
Re: Netflix shoots itself in the foot... aka no more free streaming

1001001 wrote: View Post
I think eventually the idea will have to be a premium pricing plan for new releases.
Since movie pricing is already keyed to time (it costs more to see a movie in a theater than to rent it on DVD), the logic of this should be extended - new releases are $X when released, and then the price stairsteps down at predetermined intervals. Customers can set their queue so that Title A is at $X 6 months after theatrical release, Title B is at $Y at 9 months, Title C is at $Z at 12 months, etc.

One moral-of-the-story in this whole monumental fuck-up is that is is absolutely essential to understand - and control! - customers' definition of "what is just." Netflix created expectations of "what is just" in pricing and then violated those expectations. It's not an issue of what really is just (like a lot of people have noted, Netflix's pricing is cheap anyway, and therefore "just" in comparison with other options), but what expectations are being created.

Customers already accept that "quicker means more expensive," so basing pricing on that idea is less likely to cause a shitstorm than inventing new rules that customers are not already used to.

Also, the more options you give customers to customize their pricing structure, the happier they'll be. Letting someone choose X, Y and Z price, keyed towards release date, will result in plenty of people going for X becuase people are impatient after all. But they'll be much happier about it because it was their choice. If X were the only choice, they'd go bitch about it on Facebook.

The great thing about an internet based business is that you can create a panoply of pricing options very cheaply by just building it into the database and let the customers do all the work. The more complication Netflix throws into the pricing structure, the happier the customers will be, staying busy futzing with their queue instead of making trouble. And it makes it more difficult for them to even figure out what the "right" price should be anyway, when there are too many options for easy comparison.
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