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Netflix

Can You Listen to Your Customer?

Gathering information about your customer is not the same thing as listening to them.

If you were to conduct an immediate survey right now, this very instant, of all of the leadership of all of the companies you interact with, in one form or another, over the course of any given 24 hour period, I can say, with a pretty high degree of confidence, that they’ll all tell you they listen to their customers.

Some of these companies are telling you the truth.

Others, not so much. It’s not an intentional deception, mind you. These organizations think they’re tuned right into their customers.  They point to tall, towering, extremely expensive piles of market research and demographic data with pride. All of this accumulated information must prove they’re listening to their customer.

Then we watch these companies in action. Inevitably, a point arises where it becomes clear to the uninterested observer that there’s a significant disconnect between the company and the customer. When that disconnect reaches a critical point, the brand suffers serious damage.

Although they’ll apologize out of necessity, internally they’ll blame it on a changing consumer environment that’s produced uber-senstive consumers. After all, how could all of their research have led them astray?

Yet, this phenomenon of misreading customers isn’t anything new: there’s just more eyes out there to catch companies when they’ve misread what the customers want.

All of these companies thought they’d been listening to their customers. Perhaps we’re asking the wrong question. Instead of “Do you listen to your customers?” we should be asking, “Can you listen to your customer?”

Customers First: What Do You Need to Listen to Your Customer?

Gathering information about your customer is not the same thing as listening to them. You can accumulate data all day long, only to discover that you’re not protected from making the mistakes that you saw other companies make but never believed you could.

You have to be able to listen not only to what your customers say, but what they mean.

One of our favorite stories comes in the early days of social media: before anyone changed their outfits on TikTok, before anyone filtered a selfie on Instagram, and just two years after Twitter launched and Facebook expanded beyond the college market.

The year was 2008 and epic fails just started becoming a thing. Motrin took an iron-heavy approach to babywearing that proved that if Mama’s not happy, nobody’s happy.

It’s safe to assume that at some point, via market research or focus groups, Motrin figured out that being a good mom was important to a good portion of their market. So far, so good. The need to nurture is what we call a universal driver.  The compulsion to care for the next generation is a pretty significant asset for the species that wants to stick around for a while. There’s a caregiver instinct hardwired into our psyche.

Motrin, of course, is also very interested in talking to people with backaches.

When you put those pieces together, you get this ad:

There’s even an explicit call-out to the “be a good mom” message. It blew up in their faces in a magnificent way because they didn’t know how to listen to their customer, completely and in a meaningful way.

It’s important to the customer to be a good mom. What, then, does being a good mom mean?

It sounds like a simple question. It doesn’t, however, have a simple answer.  We all have our own personal definition of what it means to be a good mom, based on our own experiences, but that’s not where the story should end. We need to understand what being a good mom means for the customer. The definition varies by community and culture. Within each group, you’ll find that being a good mom comes with its own set of expectations and norms—a set of rules to be followed by anyone wanting to be seen and acknowledged as a good mom within the group.

Some of these rules are overtly articulated, while others are conveyed via subtle social pressures. The customers begin internalizing these rules from the moment they’re born and continue to do so throughout their lives. Becoming a parent and having small children pushes these rules very prominently into consciousness; this is all information that is highly useful and relevant to have as they navigate a new experience.

As an organization, you really need to know what those rules are. You need to respect and honor the importance of these core beliefs in your customers’ lives. Motrin went wrong because the ad campaign violated two major, if unwritten, laws of American motherhood:

  • All parenting choices are made in the best interest of the child.
  • Mothers do not experience physical pain or exhaustion.

By suggesting that some mothers chose babywearing in order to follow the whims of fashion and that this could cause backaches, Motrin introduced a tension into their customers’ lives.  It may be entirely true that a customer chose to wear their baby in a sling because they thought it was a cool, trendy way to carry the baby, and that it was that exact choice that contributed to their back pain—but it is equally true that to admit to these sentiments go directly against powerful cultural norms. This tension can be experienced wholly on the unconscious level, but it is powerful enough to make the customer uncomfortable.

It is human nature to avoid the uncomfortable. Rather than confront the validity of cultural norms, especially in relation to our own personal experience, it’s easier to avoid the brand that introduced the tension into our lives.  Anger and hostility are common responses to the tension as well, as evidenced by the heated response to the Motrin babywearing campaign.

Had Motrin known what their customers meant when they said they wanted to be a good mom, they could have easily avoided violating these rules.

Delving deeper into your customer’s behavior and experiences makes it easier to develop a more comprehensive understanding you can use to connect effectively and efficiently with them—without any of the headaches Motrin experienced.  That’s the value of really listening to your customers and putting your customers first.

March 11, 2021 by

Take Two for Netflix? Brand Modeling and Recovering From Mistakes

“There is a difference between moving too quickly—which Netflix has done very well for years—and moving too fast, which is what we did in this case.”  With those words, Netflix has backed away from its controversial plan to split the company into two parts. The DVD rental-by-mail business, which was going to be called Qwikster, will remain part of the Netflix business.  It’s a reversal that makes sense.

You Lost Me At Hello: Why Qwikster Wouldn’t Work

When Reed Hastings announced the plan to split Netflix into two discrete companies, he violated one of the principal tenets of Brand Modeling: Know what your customers value most about doing business with your organization.  In the days and weeks that followed the initial announcement, one thing became clear: Netflix’s customers did not want two services providing what they used to get in a single location.  They were strongly opposed to the idea.

Imagine the headaches, stress, and damaged investor relations that could have been spared had Netflix’s leadership known ahead of time what their customer base’s reaction to the change would have been.  Let’s make no mistake.  Reed Hastings is not a stupid man.  Had he known the magnitude of the fallout from what he saw (and from the tone of Netflix’s communications to their members, continues to see) as a simple and necessary change, things would have been handled differently.

Eliminating Uncertainty: The Role of Brand Modeling

Every business has growing pains.  When you’re an industry leader like Netflix, those growing pains are going to be more visible, studied, and scrutinized by everyone: your customers, your critics, the business press, the investment community.

Growing pains occur because businesses exist in an environment of perpetual uncertainty.  We lack an absolute, definitive way to predict the outcome of our choices and actions ahead of time.  We’re in a position where we must make choices and take action and then see what happens.

However, the lack of perfect, absolute knowledge about consumer reactions and behavior doesn’t mean we’re completely clueless, either.  Brand Modeling provides us with the tools to delve deeply and intensely into the psychological factors that motivate customer behavior.  The more we know and understand about our customer base, the more accurately we can predict how they will respond to any change in operations.

It’s unfortunately easy to mistake what may seem to be the obvious right decision for your business for what your customers actually want.  This disconnect can have catastrophic consequences. It’s easy to see that Reed Hastings believes that streaming media is the future of his company.  There may be good, logical, strategic reasons to split off the DVD rental business.  However, Netflix’s customers don’t want the good, logical, strategic reasons.  They want what they’ve always wanted: a simple, enjoyable way to watch movies.

Can Netflix recover? We think they can. Reed Hasting’s emails is a small first step.  Listening to their customers, especially their most fervent, loyal customers (folks we call Brand Lovers) would be a great next step.

October 12, 2011 by

Does Netflix Know What It Is Doing?

PhotobucketAt first, we thought it was a joke—and not a particularly funny one at that.  Surely Netflix, one of the most successful and dominant brands in the world, wouldn’t make a bunch of boneheaded moves seemingly tailor made to alienate their customers. Not Netflix. We’re talking about the company that broke Blockbuster, the savvy, smart, forward looking firm that changed the way we consume media.

And yet here we are. Here we are with Reed Hastings’ shamefaced apology email, sent to millions of customers, explaining that the changes in pricing that had upset so many was only the beginning.  Going forward, the DVD rental business would be split off from Netflix, which would continue to provide streaming content.

It’s clear, reading Hastings’ words, that streaming content is central to his vision of Netflix’s future going forward. He’s not alone in believing that eventually, the lion’s share of all entertainment media we consume will be available online. We respect his vision for his industry’s future.  What we’re not so sure about is his grasp on the industry’s present.

Customers First: Valuing the Brand/Customer Relationship

We all come hardwired with deep, powerful, unconscious psychological motivators that influence our behavior—as individuals and as consumers. Our company calls these forces Humanistic Drivers. One of the most powerful Humanistic Drivers is the desire to belong to a group or community.

For a long time, we filled the need to belong by participating in community groups, social organizations, faith communities, and the like.  Increasingly, though, cultural changes have taught us to switch our attention and our affiliation away from these institutions. Instead, we’re placing a higher premium on the relationship we have with brands.

Netflix became successful because they made it easy for consumers to build a trusting relationship with them.  A high level of commitment to superior customer service, a deep and wide ranging product selection, and customized suggestions made customers feel cared about and valued. There was a sense of community: both consumer and Netflix were united in the search for something good to watch on a rainy Sunday night.

That sense of community took a serious hit with Hastings’ latest communications.  Surveying recent consumer sentiment reveals that consumers—including some of Netflix’s most devoted fans—feel deceived and lied to.  The claim that separating the DVD rental and streaming content will provide better service to customers falls flat.  The fragmentation is confusing, and there’s no tangible benefit immediately apparent to the customer.

Netflix built a successful community.  Now customers are seriously questioning whether they want to remain members of that community. The service that initially attracted them—renting DVDs by mail without late fees—is now, somehow, no longer relevant to the community they joined? Before making a change to the fundamental operations of your company, it is a good idea to forecast how those changes will be received by your Brand Lovers—those most fervent, loyal customers who contribute the most to your company’s profitability. We’re not getting a sense that this was done here.

Can Netflix recover? Perhaps.  But rebuilding damaged relationships takes time and skill.  Hastings and the rest of the Netflix leadership team need to begin the rebuilding process by taking a look at why they went so far off the rails in the first place.  The damage starts when you stop putting customers first.

September 26, 2011 by