In 2011, Netflix made one of the biggest marketing faux pas of all time: it attempted to split its DVD-by-mail service and DVD streaming service into two different companies, calling the streaming service Qwikster. The split was complicated, confusing and lacked clear communication .
The split was supposed to make streaming DVDs easier and enable Netflix to focus more of its resources on obtaining streaming content since the DVD rental option was beginning to taper off in popularity. It was supposed to be more convenient for users, but the entire concept of Qwikster was anything but.
Before the whole fiasco, Netflix had a $16 billion market value and 12 million happy customers with joint streaming/DVD-by-mail accounts. Then for the one month Qwikster existed, it did nothing but foster ill will toward Netflix.
Qwikster lacked the all-important grandfather clause that prevents impacting existing customers. It required all Netflix/Qwikster users to create two accounts at two different domain names with two credit card statements and two sets of ratings and preferences – not to mention pay 60 percent more for the exact same services.
The funniest part about the whole lack of clear communication on Netflix’s part is that a pot-smoking teenager already owned the Twitter handle @Qwikster at the time of the split, making customers even more confused if they attempted to tweet a complaint. All customers could see on that Twitter account was ramblings about boredom, smoking and partying.
In the end, Netflix’s marketing faux pas cost the company 800,000 subscribers and its stock price plummeted 77 percent in four months.
Everyone knows that businesses need to remain agile in an ever-changing market, but clear communication is the key to making changes without infuriating customers. Choosing a respectable name for the media company such as "Netflix Online" or "Netflix Streaming" would also have undoubtedly reduced the mockery and derision the short-lived Qwikster received.
For more information about the importance of clear communication in a professional business environment, contact Hurley Write, Inc . We offer writing courses to help improve your business communication prowess.
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