Netflix, a US company that started life as a DVD-by-mail rental service, then added digital movie streaming to its offering recently announced a poorly-received corporate restructuring. In addition to a price increase for the mail and streaming services, the company split the offering into not only two products, but two separate companies with their own billing, recommendation, and customer account systems. Whereas a customer could formerly login to the Netflix website and manage a queue of movies for mailing or streaming, the split would create two different, non-integrated places for customers to do the same tasks, and even charge two separate items to a customer’s credit card each month, a move akin to a restaurant forcing you to go into a different room, with a different waiter, and pay a separate bill for your appetizer and entrée.
Historically, the company has often been regarded as consumer-friendly, and technologically advanced, so the move legitimately offended a highly vocal group of customers. The CEO of the company offered a non-apology, and attempted to convince customers that splitting their service, creating more administrative hassle, and effectively increasing the price for less convenience were in their favor.
These types of maneuvers can best be described as a kind of corporate narcissism, where companies focus internally and treat customers as an inconvenience, rather than the reason they are in existence. The US-based airlines have been guilty of this for years, with flight attendants literally rolling their eyes while dealing with customers as if the flight was scheduled for the airline staff’s personal amusement, and then those pesky paying customers rained on the party.
This narcissism can also occur internally, with corporate divisions passing inane policies and procedures that scratch some parochial itch, while inflicting hours of extra administrative burden on the larger organization.
While the customer (external or internal) is not always right, they are almost always the ones that provide the financial lifeblood of your company. When you consider some elaborate strategic shift and there is nary a mention of how it will impact paying customers, make sure you’re not preening in front of the mirror while the building around you burns down.