We hope to shine a light on exactly where Netflix has erred and how to avoid making the same mistakes yourself. But first, let’s define what customer experience is.
What is customer experience?
In short, customer experience is a customer’s entire perception of your business and brand. It is the summation of their experience from top to bottom, starting before they purchase to the moment they receive their product/service from you. This includes your website, purchasing, any contact with customer service, and receiving the goods/services you provide.
User experience is a key component of customer experience, but it is just that. A part of it. Customer experience is the overall umbrella that user experience, user interface, and other pieces of the puzzle fall under. You can some good pieces, but they all work together and add up to the whole experience.
Read More: How to Measure Customer Experience
How Netflix failed at customer experience
As we mentioned before, a large portion of the population prefers Netflix’s user experience over other streaming platforms. However, with recent projected changes and business decisions, the streaming giant is losing thousands of subscribers at a time consistently. Within the first quarter of 2022, it lost 200,000 and projects losing 2 million by the end of quarter 2 – a scary projection for the world’s largest streaming platform.
So what has gone wrong? We think there are three main aspects of the customer experience that have failed, and this is why so many are abandoning the SS Netflix.
Content
Content is king, when it comes to customer experience. Many veteran streaming platforms have beat out Netflix in providing the films and TV shows that customers want to see. While Netflix has been on the market the longest, they have lost their grip on having priority over popular media. As well, many film and television shows have entered the streaming game and have exclusive streaming rights on the content they have created, leaving Netflix a bit high and dry.
Why the platform has tried to compete with its own original shows and films, it has become clear that it’s often more expensive to maintain the cost of creating shows, compared to contracting ones that already exist. This has led to many good shows that have been well-received being cancelled.
Meanwhile, platforms like HBOMax, Hulu, and even Apple TV have been giving Netflix a run for its money with content generation and quality. While these platforms have a ways to go in building up their UX, they are leading the pack in this aspect of CX.
Value vs. Cost
Another area that Netflix is struggling in is cost versus value. In the beginning, they had the competitive prices on the market. This is what put video rental stores like Blockbuster out of business. However, as other streaming platforms have entered the scene and the market has been split a bit more, Netflix has gradually raised prices. While this isn’t necessarily bad, when coupled with the content issues, it becomes a greater issue. Currently, the highest subscription tier costs around $20. Comparatively, Apple TV+ costs $4.99/month and Hulu costs $12.99/month. Even on the higher end, HBOMax comes in at $14.99/month for the ad-free plan.
So what do all of these (and other) platforms have in common, besides being cheaper than Netflix? They have better and more diverse content. Between films, old content, and new, original shows and films, all of these platforms are giving Netflix a run for its money. While Netflix has great global content and reach, it’s missing a lot of popular, mainstream content, making it not competitive. And who wants to pay $20 for lackluster content?
Honoring customer loyalty
The final nail in the Netflix coffin is the disregard for what has brought and kept customers this far. In response to the massive loss in subscribers and revenue, Netflix first announced that it planned to crack down on accounts sharing passwords outside of their households. Then, after much backlash and more subscribers bailing, they shared the possibility of adding a subscription tier with ads. Here’s why neither of these options is a good idea.
Netflix has never had ads. That’s been one of the selling points. As the first platform to successfully make streaming profitable, the lack of ads has always been a part of the Netflix appeal. So to add in a tier with ads as a way to make up for lost revenue is very simply bad customer experience. Sure, other platforms have ads. However, they have had those ad-based options from the beginning.
In addition, Netflix users have been sharing passwords from the beginning of time. That has been one of the main appeals of the platform to the point that they and other streaming platforms have a setting where you can create multiple accounts for different users. To switch up and try to charge extra for those sharing accounts across households is nothing short of disrespect to the users who have been loyal to the platform since its inception.
Conclusion
At the end of the day, Netflix has failed its customers. While user experience is key to keeping and converting customers, it is only a piece of the larger puzzle. That puzzle is customer experience. When part of the CX falls apart, it has a domino effect on everything else. However, Netflix still has a chance to change the reality it faces. It won’t be an easy journey, but they can turn it around before the platform goes the way of its predecessor – Blockbuster.
Tim Rotolo
Shruti Goli