Tuesday, September 20, 2011

Some Quick and Dirty PR Lessons on Quikster and Quixtar

The split of Netflix into streaming video and a new DVD service called Quikster has grabbed attention on blogs and Twitter lately. See this post on Ragan.com as an example.

Here are some PR lessons learned, including a West Michigan angle:

  • Apologies should be sincere and address what is really upsetting people. Netflix CEO Reed Hastings posted an "apology" that didn't address the price increase that upset consumers.
  • PR is about two-way relationships, and had Netflix grasped this and learned in advance with on-going dialogue or basic research of consumer brand and price attitudes they may have avoided this crisis.
  • PR involves dealing with multiple publics. Consumers being upset about price led to lots of them bailing which led to a 19% stock drop. Investors are people too. This is why consumers should not just be left to marketing and investors to investor relations or finance pros. PR people should be at the management table advising their management colleagues from all sides about how actions and words affect multiple publics. Some call this "integrated marketing communication"; I call it basic PR and common sense.
  • Name changes don't change perceptions or behavior. Splitting from Netflix to Netflix and Quikster is done for internal reasons. It is not convenient, easy, or better in any way for consumers. 
  • Short-term decisions can lead to long-term brand damage. Notice how Amway and Quixtar are recalled by the Ragan writer? Quixtar re- re-branded recently back to Amway because the name change never worked. But the move--again which probably seemed good internally--backfired consistently. 
Wise leadership and smart PR do not usually come from making quick decisions. They are evidenced by listening, pondering consequences, and managing relationships vs merely the bottom line. It's better all the way around to be patient and clean than quick and dirty.

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