Tuesday Buzz: How Netflix Navigated a Price Increase

Despite raising its prices, Netflix actually saw a huge surge in subscribers during its most recent quarter. The reason? It offset the increase with additional value. Also: The roller coaster of event emotions.

Sometimes, price increases can scare away your members. But they don’t have to—especially if your benefits remain worth the cost.

Case in point: Netflix. At times, the streaming company has struggled to raise its prices without facing consumer backlash—most notably in 2011, when the company was criticized for its attempt to spin off its DVD-delivery service from its streaming service.

In its most recent quarter, however, the company had no such problems—it raised its prices by $2 for long-term subscribers and ended up seeing a big gain in overall subscribers worldwide (3.6 million, far above analyst estimates of 2.3 million), while churn remained minimal. The reason? The benefits of the service were clear to customers—particularly in this quarter, when the network had a breakout success in the form of its original show Stranger Things.

“When we have some big originals it definitely grows the business,” CEO Reed Hastings said during a conference call, according to USA Today.

Obviously, Netflix is a for-profit business—one that’s seeing a massive surge on the stock market on the back of this news. But the basic idea is most certainly applicable to associations: If you want to navigate a price increase, ensure that members are seeing comparable value from the increase.

Ups and Downs

Planning an event can evoke a lot of emotions—the initial excitement, then the anticipation, frustration, and doubt. It can get a little all over the map, honestly. EventBrite has a new infographic on its site, highlighting just how up and down things can get. Check it out over this way.

Other Links of Note

Good read of the day: Fast Company has a lengthy feature about the leadership challenges Chipotle has faced since a food-poisoning outbreak created severe momentum challenges for the fast-casual giant.

“Don’t just gab about what is important to your group.” At Association Executive Management, David M. Patt highlights some strategic considerations for your public relations campaigns.

Marketers in the startup space are very much worth learning from. On the Buffer blog, the company’s Alfred Lua offers a list of marketer blogs to watch.


Ernie Smith

By Ernie Smith

Ernie Smith is a former senior editor for Associations Now. MORE

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