Binging Netflix movies and shows just got more expensive. The streaming giant has raised the price of its standard and premium plans to $13.99 and $17.99 a month, respectively, for new subscribers. Its basic plan stays unchanged at $8.99 a month. Current users will see the new fees over the next few weeks. Netflix last increased fees in January 2019, and the latest jump comes as streaming competition increases and subscription growth slowed following a pandemic boom earlier this year. Netflix says the increase will allow it to invest more heavily in the quality and quantity of its content. (source)
Improve your service delivery to make your consumers become customers. The greatest companies go beyond having customers – they engineer FANS out of customers. When customers are fans, great moments arise and glory awaits. Yes, it is about going beyond Needs and Expectations to Perceptions of customers.
On that, I note the news that Netflix is raising prices of its products. Yes, this is a company which is under frontal and flank attacks from Disney+, Amazon Prime, and other video on-demand players, which to a large extent, are more affordable. Yet, the company is very confident that it is raising prices. That is the power of understanding that you have quality to keep the fans in your ecosystem.
Netflix’s prices are going up. The streaming media company is raising the prices on its standard and premium plans for US customers. Its standard plan is now $14 a month, up $1 a month from last year.
Its premium subscription will go up $2 to $18 a month. Its basic plan remains unchanged at $9 a month.
Netflix’s (NFLX) stock rose 5% following the news. The new prices will take effect starting immediately for new members while current members will be notified that their subscription is going up as it rolls out over the next few months.
“We understand people have more entertainment choices than ever and we’re committed to delivering an even better experience for our members,” a Netflix spokesperson said in a statement. “We’re updating our prices so that we can continue to offer more variety of TV shows and films.”
According to Business Insider, Disney+ “is now available for a monthly price of $6.99 a month, or an annual rate of $69.99 a year. For these prices, subscribers get ad-free access to thousands of movies and TV shows, including programming from Disney, Pixar, Marvel, Star Wars, National Geographic, and 20th Century Fox.” So, the cheapest Disney+ package is $6.99 when compared with the cheapest Netflix which remains $8.99 a month, unchanged.
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For Netflix doing this – increasing prices in some categories – it has a lot of confidence in its products; most would have expected it to cut prices to compete with Disney+. And that offers a lesson to everyone of us: winning in a competitive market cannot just happen via the lowest cost denominator. Build your tribe of customers, and have better cost positioning in markets.
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Movies are unique, it’s not like watching primetime news where you can guess that major news across all networks are fairly the same. So, reducing prices just because of competition is not really a great idea, if you are confident about your offerings, your customers and fans will stick around.
If The Village Masquerade is showing, and you know that it’s only one platform that airs it, and you want to watch it, what do you do? You pay to watch! Entertainment business is unique, that’s why we cannot afford not to play there…