Marketing has changed: The Netflix BluRay price increase FAIL

I saw a tweet from Jason Calacanis before the e-mail hit my inbox. Netflix was raising rates for a second time in 5 months on blu-ray disc access. If you are in marketing at Netflix, please note, he has 64,188 followers. Take that- and retweets- and you see the exponential nature of Twitter- instantly.

His original tweet:

NetFlix Blu-Ray bait and switch FAIL! Jump from $1 a month to $4 a month automatically?!!?

Then, follow over to a twitter search on “Netflix” and you see the effect- instantly- the twitterverse is alive- with cancellations, downgrades and unhappieness. This is an opportunity for Blockbuster- but, they probably don’t know how to take advantage of it.

Over on Engadget- it’s breaking news:

Ruh roh. In a move that will undoubtedly cause an incredibly raucous stir, only to fade away as movie renters realize that Netflix is still the best deal going, America’s most adored by-mail rental service is hiking the price of Blu-ray rentals once again.

via Netflix raising rates for Blu-ray subscribers by around 20 percent.

The comments are flowing- who knows how many people will be blogging about this, and what kind of damage will be done. The pricing increases are heavy handed to begin with- but the automatic “Opt-in” to a price increase is a brand suicide move. Never, ever, force an automatic price increase without some kind of action by the customer.

On the Netflix site - their blog has an announcement- and the feedback isn’t going so well. Might be time to reevaluate how this works. Maybe a per-disc surcharge for blu-ray?

Either way- be careful how you treat your customers these days, they have the tools to talk amongst themselves and plot your downfall. Both Netflix and Twitter are populated by opinion leaders- who are very tech savvy. Your brand is only as good as your community around it. Netflix’s brand value is totally connected to the way their customers feel about them (as well it should be).

Watch this in the news. It’s going to be brutal.