True Loyalty a Case for Going Beyond Customer’s Transactional Data
December 1 2011 by Troy Blackman
Unless you’ve been on the moon, you probably heard that Netflix has done some damage to its brand recently. First, they announced a price hike, increasing the price most people were paying by 60%. Then, they followed that up by announcing they were separating their business into two distinct (and separate) offerings.
They made a lot of people angry. A lot of people left, or downgraded their service. They took a beating in the stock market and lost shareholders a ton of cash. How did they justify these moves? With research. They said their research told them more people used the streaming service (or were moving that direction), and the DVD business would soon be obsolete. Therefore, in order to keep what might one day be a dying business from tearing down a profitable one, they separated them. It all sounds good on paper, but they forgot one thing – their customer’s opinions.
Sometimes we need to look past what the data is telling us, and listen closely to our customers. Had Netflix done this, they might have realized that their customers weren’t upset just over a price hike, but more over the perceived value (or lack thereof) of the service. The rate hike may have made sense on paper, but wasn’t justified when their customers already felt they weren’t getting the best deal.
Remember that part of great marketing is knowing your customer – not just the transactions, but the needs, behaviors and attitudes as well. Before you make the next big decision, consider that along with the financial data. It will be wiser and more informed.
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Andy
