The morning of 19 September 2011, the Chief Executive Officer (CEO) online movie provider Netflix Incorporated (Netflix) has witnessed a growing public discontent and criticism of the media. The night before, general manager at the company's blog announced that Netflix will be split into two separate entities. With the proposed changes, Netflix DVD by mail service will be spun out and renamed Qwikster. A move would leave the brand Netflix, to focus on the offer online streaming entertainment. It was not the first time, Netflix has caused great disappointment consumer level, a few months ago, in July 2011, the company announced that it will increase prices by as much as 60 percent. With the loss of more than one million subscribers Netflix in September 2011, which is the first time the company has never lost subscribers from one quarter to another. Although split into two separate entities can be seen as a good business strategy, Netflix does not perform well developed communication plan. Going forward, both Netflix and Qwikster became the symbol of bad two-headed monster movies with Netflix management in a desperate need to develop more effective relationships with disgruntled customers, or risk losing more subscribers and lucrative profits to the growing number of competitors. "Hide
by Jana Seijts, Paul Bigus Source: Richard Ivey School of Business Foundation 12 pages. Publication date: April 24, 2012. Prod. #: W12918-PDF-ENG
Related Case Solutions & Analyses:
Singareni Collieries: From Gloom to Glory
Airport Express Metro Line: Infrastructure Project Financing and Implementation Through Public Private Partnership
Project Dilemma at Canadian Shield Insurance
From Hand-helds to Smart Phones – The Pioneers of Palm Inc.
Eureka Forbes Ltd: Growing the Water Purifier Business
Hopax (C)
YvesCreations LLC: Alex Goes to Hollywood
ArcelorMittal (B)
Frans Ryckebosch: An International Manager (A)
Harley-Davidson India
