NetFlix Hopes Good Customer Service Will Keep Mail Boxes Stuffed With Red Envelopes

from the nice-talking-with-you dept

Although Blockbuster sat on its heels for a long time while NetFlix gobbled up market share, the company has aggressively fought back this year, prompting a lot of pain at NetFlix. NetFlix stock has been pummeled lately as its been drawn into a price war in order to stem customer churn. The problem is that its business model is easily replicated, which partly explains the company's attempt to assert a patent on it. However, the company does appear willing to actually compete, which is refreshing. The New York Times reports on the company's unorthodox decision to offer customer support services from friendly sounding Oregonions (as the company puts it), rather than rely on offshoring or email support. Although this is an expensive move, the company feels it will prove to be a key differentiator as it battles back Blockbuster. Obviously, good customer support means happier customers, while bad customer support can turn customers away. But the lesson isn't that companies should immediately stop all offshoring of these services. Rather, it's important for companies to think of customer support strategically and weigh the various costs and benefits, rather than just going on the lowest-price option.


Reader Comments (rss)

(Flattened / Threaded)

  1.  
    identicon
    TheDock22, Aug 16th, 2007 @ 2:26pm

    Biggest Killer

    I think the big issue between Netflix and Blockbuster is that with Blockbuster you can return the movies to the store and get a new movie. Even though Blockbuster has a horrible website compares to Netflix, people would rather have options.

    Although I think Netflix could compete with that. We have Redbox DVD vending machines all over the place. If Netflix invested in some machines that people could return their movies to and grab another movie that's in the machine, they could close that gap with Blockbuster at a lower cost than opening and maintaining stores.

     

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  2.  
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    AA in LA, Aug 16th, 2007 @ 2:29pm

    Re: Biggest Killer

    Agree. I just tried one of those vending machines last weekend ($1/day!) and will definitely use the service again. I really want Netflix to win this one because they seem to be the more progressive of the two. Also previous bad CS from BB stores has made me avoid them if at all possible.

     

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  3.  
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    Ajax 4Hire, Aug 16th, 2007 @ 2:33pm

    I am a Netflix customer and

    I love it.
    Netflix has more than just movies.
    Netflix rekindled my lost desire to watch TV again.
    There is no way I will every go back to Blockbuster.
    I don't care how cheap or slick Blockbuster makes their product, there is no way I will ever be one of their suckers, I mean customers again.

    Netflix has a double bonus in that it was first, it is very easy to use and it is not Blockbuster, I mean triple bonus.

    My only complaint with Netflix is the new web site is too Javascript, "in your face suggestions" that are starting to get old; but it is not Blockbuster.

    The few times I have actually needed to contact Netflix, I got quick response and good Customer support.

    There are all the old television shows available on DVD with no commercials. I can watch a complete series front to back. This is important for those TV shows that rely on past shows like Star Trek, Babylon 5 or 24.


    oh yeah, 1st.

     

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  4.  
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    anonymous coward, Aug 16th, 2007 @ 2:33pm

    this is just the first step in offshoring. you use a onshore call center for concept testing, training, script development, customer acceptance, etc... then you offshore it.

    in 6-12 months, this will be offshore. duh!

     

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  5.  
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    Ajax 4Hire, Aug 16th, 2007 @ 2:36pm

    Re: Biggest Killer

    No way,
    People are lazy.
    Given the choice of waiting for a DVD in the mail and going to the store, I bet on the lazy answer.

    when predicting human behavior, remember:
    "It is easier to do nothing."

    Plus, I think there is a whole world of people out there who hate Blockbuster, not just dis-like but hate.

     

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  6.  
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    TheDock22, Aug 16th, 2007 @ 2:47pm

    Re: Re: Biggest Killer

    No way,
    People are lazy.
    Given the choice of waiting for a DVD in the mail and going to the store, I bet on the lazy answer.


    I disagree with that. Some people are lazy, but not all. Sometimes I watch the movies I get in the mail and then just end up heading to the video store to rent something else.

    Maybe the younger generation doesn't mind waiting for movies, but what about families with children? I think the option to return to store (or conveniently located kiosk)is a fantastic idea. I just don't like Blockbuster. I only rent from RedBox these days though.

    Oh yeah, you weren't 1st. =)

     

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  7.  
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    Norman619, Aug 16th, 2007 @ 3:14pm

    Re: I am a Netflix customer and

    I recently went back to Netflix and have been a little upset with the service. In almost every 3rd rental I make one of the DVDs come to me either scratched really badly or broken. Netflix does rush a replacememnt copy to me but the fact that I have been getting this many damaged DVDs bugs me.

     

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  8.  
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    Norman619, Aug 16th, 2007 @ 3:17pm

    Re:

    Howmany people actually call Netflix? I have never had to call them. I just use their website. It's pretty easy. I don't really see a vlaid reason for needing to speak to someone other than maybe trying to cancel your service and trying to get the balance of your monthly fee back.

     

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  9.  
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    Esther, Aug 16th, 2007 @ 3:23pm

    There

    I've never called Netflix either; in fact, I would swear to you that I didn't even know they had a call center. All problems I've had were resolved through email.

     

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  10.  
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    Eric the Grey, Aug 16th, 2007 @ 3:37pm

    Re: Re:

    I have to agree. I've never seen a need to actually call a person at NetFlix. Every time I've had a damaged disk, or one that simply disappeared, I click a few links on the website, and it's a done deal.

    It's nice to know that there is a human option available though, and even nicer to know that they are Americans manning the phones. While overseas tech support can be effective, it irks me that companies spend money on people in another country, when we have such high unemployment rates here at home.

    EtG

     

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  11.  
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    Eric the Grey, Aug 16th, 2007 @ 3:43pm

    Re: I am a Netflix customer and

    here are all the old television shows available on DVD with no commercials. I can watch a complete series front to back. This is important for those TV shows that rely on past shows like Star Trek, Babylon 5 or 24.

    This is the main reason I use NetFlix. I have worked night-shift jobs most of my adult life, and I tend to miss all the shows I wanted to watch. Today, it's not as much of a problem, with DVR's available wherever you turn, but back when the past few Star Trek's came out, they always seemed to be on nights that I worked.

    I'm currently on season 6 of DS9... Anyway, NetFlix makes it extremely easy to add a season of shows to your queue, and they keep them in order. Blockbuster made you add them one at a time, in the order you wanted to watch them. A royal pain in the posterior.

    I tried Blockbuster, and tried to find a reason to like it, really I did. But their lack of variety, both online and in the stores, as well as their cumbersome website drove me away.


    EtG

     

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  12.  
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    Anon, Aug 16th, 2007 @ 4:00pm

    Netflix.. oh netflix

    After reading this article I decided to call and proposition Netflix to give me the $15.99 deal, but they said they are "testing" the price out with selected customers, and it isn't available to everyone.

    So I'm calling shenanigans on Netflix for unfair pricing (not that I'm one to really care about $1). I am happy they are trying to save everyone money - so on that note, yay Netflix.

    Blockbuster has always angered me with their brutal late-fees and un-helpful staff. I would never go back.

     

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  13.  
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    rg, Aug 16th, 2007 @ 4:08pm

    better selection

    i dont mind to wait to get a better selection of movies, and movies UNCUT (something block buster does a lot), so I go for netflix. No need to go , walk many aisles withotut any hint of a movie at blockbuster.

     

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  14.  
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    Czarcastic, Aug 16th, 2007 @ 4:18pm

    Netflix still punishes their best customers

    In spite of Blockbuster's competition and a class-action lawsuit, Netflix persists in punishing those who view and return too many movies per month for Netflix's liking. If you view and return movies in a day or two then you will be prevented from obtaining new releases as they come out or anything remotely popular.

    I don't care if the CEO of Netflix answers my call for support, until I can order and view as many DVDs per month as I want on my 3-at-a-time plan, then the new pricing I have been offered and the lame on-demand PC movie views are not going to get any more referrals from me. The quality of the DVD's (broken, scratched, wrong DVD in the sleeve) has definitely gone down in the past 18 months.

    After being a customer almost since Netflix began, I am now about to move to another option if there is not a resolution to the restriction on rental frequency soon. Oregonians making excuses for Netflix's draconian Terms of Service is no better than getting the same excuses from the Philippines or India.

     

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  15.  
    identicon
    Celes, Aug 16th, 2007 @ 5:30pm

    Re: Re: I am a Netflix customer and

    That is strange. I've been a customer for... I forget, but it's quite a while now, and I've only ever received one damaged DVD.

     

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  16.  
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    j, Aug 16th, 2007 @ 5:30pm

    Blockbuster just looks so good...

    I held out on going with the new Blockbuster deal, but I couldn't wait any longer. I was going to the store every week because my Netflix queue never fit my mood.

    Finally I switched. The final cancellation page on Netflix's site asks you why you cancelled and most reasons in the menu have something to do with B-buster. It made me sad when they thanked me for my patronage; I always hated Blockbuster but it just didn't make sense to stick with Netflix.

    I agree with the RedBox concept, but they should be somewhere like colleges and strip malls not supermarkets.

     

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  17.  
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    Ajax 4Hire, Aug 16th, 2007 @ 5:39pm

    Re: Re: Re: Biggest Killer

    Yes,
    people are lazy,
    you may not be but people are.

     

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  18.  
    identicon
    JTB, Aug 16th, 2007 @ 6:34pm

    Netflix>Blockbuster

    Blockbuster is lame for the fact that they censor the movies they have available. You cannot rent anything over R from blockbuster, and netflix doesn't seem to have this problem. I am against censorship in any shape or form. The local blockbuster sucked anyway and now it has went out of business, so for me anyway netflix is the best of the two because if I used blockbusters service, and wished to "return my disks to the store" and exchange that means an hour drive in any direction to get to the nearest brick and mortar establishment. Netflix isn't perfect but they are the less of the two evils so to speak. http://www.manuelsweb.com/netflix.htm (anti-netflix article)

     

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  19.  
    identicon
    Nick, Aug 16th, 2007 @ 6:49pm

    I have been Netflix subscriber since it started and I love their movies selection. My brother subscribe to BB and I didn't really care for their webpage and movie selection.
    The whole reason of renting online is that you don't have to go to the video store.
    Redbox comes in real handy. I rented from them time to time if the movie on my netflix queue is on long wait list.
    Dollar a day is not that bad but I just hate to drive back to the supermaket to return the movie but one nice thing about it is that you can return at any readbox machine. It doesn't have to be the one that you rented from.
    I read somewhere that Netflix is working on some kind of box that let you download the movie instead of having them sent it to you by mail. If the quality is not as good as DVD or Hidef then I'll pass. I was wondering how far is that project coming along.

     

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  20.  
    identicon
    Haelian, Aug 16th, 2007 @ 7:01pm

    Porn

    Honestly, I would be willing to bet that if Netflix started issuing porn DVDs, they would dominate. No question.

     

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  21.  
    identicon
    OPR8R, Aug 16th, 2007 @ 7:20pm

    Blockbuster Video, meh...

    Blockbuster sat back on it's fat booty and didn't innovate. Doesn't seem fair that they're allowed to steal what I consider to be "technology" and use it against those that pioneered it. IMO, that's not competition, that's robbery. Competition would be if Blockbuster developed a new/better way to get us our movies....

     

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  22.  
    identicon
    Sanguine Dream, Aug 16th, 2007 @ 10:24pm

    I'm pleased with Blockbuster...

    I've been using them for a little over a year and half and after almost 200 movies for most part I can say I am pleased with their service.

    Out of those nearly 200 movies I've only had 4-6 that I received damaged and had to return and replacements never took over two days. The turn around isn't that bad. If I drop my 3 movies in the mail on Monday I'll get my next three by Friday at the latest and since I work all through the week and only get to watch on weekends anyway that doesn't bother me. And as for customer service I've only had to call them once (I'll get to that in a second) and I got my answer on the spot without an insane waiting time or a silly automated system.

    However no system is perfect. Blockbuster seems to be random on the rated versions of movies they carry. How can have the unrated version of one movie but not the unrated version of another? The way their queue is setup how soon they can get a movie out to you takes priority over position in the queue...even in a DVD boxed set. This resulted in me putting a 5 disc set (the anime Weiss Kruss) in my queue and when it got to the top they sent me discs 1,3, and 4. I watched 1 thinking they'll send me 2 and no...they sent disc 5. Well I called their CS line and they told me that they would send me disc 2 out without having me send in 3-5 (remember I've already seen 1 and I didn't want to risk sending back 3-5). So what did they do? They sent me disc 1 again. I just got so frustrated that I sent all of them back and gave up on it. Oddly enough after that every boxed set I've tried after that has gone off without a hitch, so I may try Weiss Kruss again someday.

    Personally I think if they would carry more beyond R rated and unrated versions and change their queue priorities from:

    1.availability
    2.proximity (from distribution center to your location)
    3.position in queue

    to :

    1.availability
    2.position in queue
    3.proximity

    they would be a lot better off.

    And for god's sake start offering game rentals online (the hope that they would do so eventually is why I chose BB over Netflix).

     

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  23.  
    identicon
    KH, Aug 16th, 2007 @ 11:16pm

    Re: Re: Biggest Killer

    You cannot generalize to a population as your statement "People are lazy." indicates.

    I live 75 miles from the nearest Blockbuster and it's in another state. Netflix is my best option for viewing movies. Plus I have two dogs and don't leave them for hours at a time to go to a movie or to drive out of state for shopping purposes.

    And, I do not own a television. Netflix has provided more quality entertainment than a tv ever could. There are no commercials, there are many genres to choose from,the supply is endless, and the cost fits my budget perfectly.

    Thank you, Netflix.

     

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  24.  
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    mc, Aug 17th, 2007 @ 12:15am

    When I was teen I used enjoy going to video store to rent because it was a way to kill boredom.. now I'm 25 I'm a lazy fck I work and pay bills, and get on my computer(spend most of my time) and rent online lol... I do wish we could go back to those good day end of 80's and beginning of the 90's when was fun and relaxing to go video store and try sneak into porn section ;)

     

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  25.  
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    Joe Schmoe, Aug 17th, 2007 @ 7:43am

    > Honestly, I would be willing to bet that if Netflix started issuing porn DVDs, they would dominate...

    They've been sitting on the domain name "netflixxx" for years

    http://www.networksolutions.com/whois/results.jsp?domain=netflixxx.com

    though it's probably to protect themselves from someone else doing it on their coattails...

    I don't expect see it comming any time soon, but I would not be offended if it did.

     

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  26.  
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    Joe Schmoe, Aug 17th, 2007 @ 7:46am

    > And for god's sake start offering game rentals online...

    Now I'd be all over that! I've yet to shell out for "yet another account" at gamefly, but for another buck or three on my netflix subscription... yes, I'd be there

     

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  27.  
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    Wonderfull, Aug 17th, 2007 @ 8:07am

    Why do I care about customer support?

    I have been a blockbuster.com customer for a year.. Never had to call customer support... My friends who swear by Nerflix for the past 4 years have never called support. Netflix is trying to solve a non-existent problem. Waste of $$ and more marketing crap.

     

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  28.  
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    Pat, Aug 17th, 2007 @ 11:18am

    People or vegetables?

    I believe the good folks who live in Oregon are known as Oregonians rather than Oregonions, which makes them sound as if they are related to leeks ...

     

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  29.  
    identicon
    name, Aug 17th, 2007 @ 12:30pm

    Re: Porn

    try www.adultdvdempire.com

    rent porno dvds! same idea as netflix.

     

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  30.  
    identicon
    matt, Aug 17th, 2007 @ 1:18pm

    Great service, Very poor availability

    I did call customer support; they were very friendly. However all the niceness in the world cannot change their answer of "we are sorry, but "X" movie is in high demand, thus your estimated ship time is 3-4 weeks."

    I only use Netflix for new release, blu-ray movies. They are too expensive to buy, and Blockbuster only has a few test stores that carry them, not to mention BB Online's ship time is 1-2 days longer and poor availability in my experience.

    How can they have the audacity to charge me on a time-basis yet tell me it will be 4 weeks to ship my movie? Their response: put other movies in your queue that don't have a long wait. Great, so rather than NF actually buy an adequate number of discs for the movies people WANT to watch, they have the additional audacity to tell me to just rent something else that I (and apparantly the rest of their subscribers) DON'T want to watch.

    My NF experience is ALWAYS receiving #'s 4-10 in my queue and only receiving my top picks a month or more after their release. To their credit I have never received a damaged or wrong disc. But I am always receiving some crappy movies they have tons of copies of while the ones I want to see sit as #s 1-3 in my queue on a Very Long Wait for weeks at a time.

    I really want to cancel my membership but have not found any superior Blu-ray alternatives out there.

     

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  31.  
    identicon
    Kris, Mar 18th, 2013 @ 10:10pm

    Adult DVDs

    I am also surprised they have yet to offer adult/porn titles. I agree they would dominate. I usually just purchase mine from http://www.adultavenuedvds.com but I would definitely rent from Netflix if they offered it.

     

    reply to this | link to this | view in thread ]


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