Netflix has announced that they will be raising the cost of their monthly media streaming subscriptions by $1-$2 per month.
In a world where customers regularly complain about hikes to their cell phone, internet, pizza, and other miscellaneous costs, the Netflix brand community is not. And that’s because the company has gone out of its way to make sure that they stay on their current (very adoring) fans collective good side.
How you ask? It’s easy. Netflix will indeed be raising the price of their monthly subscription packages, but only to new customers.
Rewarding current customers is something that a lot of brands get wrong. We see campaigns offering new cable customers a big discount. There are banks offering free money when you open a new savings account. You can get a toaster, t-shirt or treats if you’re a new customer almost anywhere. But rarely are there rewards for already being signed up somewhere. This means that the current, loyal, happy customers will continue to be loyal and happy and are much less likely to cause a scene on social media when the time comes for their price to increase in the next year or 2.
Netflix is also keenly aware of the fact that as a no-commitment service, they have to continue to offer great content at a fair price or their brand community will happily migrate to a new option when it presents itself. And it will.
It also helps Netflix’s cause that they have announced an investment in more original programming with this new found revenue. The success and popularity of House of Cards and Orange Is the New Black has given the brand license from the fans to take the new money and try produce more quality content.
If Netflix continues to expand their catalogue of TV shows and movies, while adding great new content, the brand community will continue to grow, be strong and act as ambassadors for the brand. Plus, at a time when day-to-day entertainment costs (cable, movies in theatre, restaurants, etc.) are rising, a $24 per year increase, spread out over 12 monthly payments, is nothing more than a drop in the bucket.
Netflix has been a bargain brand since the day it arrived on the scene. And even at $10 a month instead of $8, it still may be the best bargain, with the strongest brand community in the home entertainment industry.