Many of us conventional consumers are used to certain constants in our lives. We get up, we go to work, and when we get home, Netflix is waiting for us. The unjudging glow of an episode of The Office for the 15th time is a staple in the twilight hours for many a weary weekend warrior. But then, like with the unexpected death of a beloved character in a favorite series, the illusion suddenly shatters. Netflix has to go and raise prices. Again.

This Isn’t the First Time

We’ve seen this movie before. Larger news outlets and edgy online publications alike try to put an elusive original spin on the inevitable. They’ll either laud the streaming savant as a juggernaut of creative content, or they’ll warn of doom and gloom for the company and its subscribers. Either way, the real story quietly continues the same way every time. Netflix is still raising prices, and just like with the series that killed off our favorite character, we’re still watching.

Follow the Numbers

Before I send the Hulu heroes into histrionics, this is not another pat on the back for the big guy. This is a business lesson in knowledge and trust when it comes to a customer base. Put your personal streaming preferences aside for a moment, and consider the facts. Despite protests about every previous price hike, Netflix managed to inflate its stock with the moves while continuing to add tens of millions of subscribers year over year. This, the largest price increase since the company’s humble beginnings, was greeted by a 6.5% bump on the market the next day. While the share price has momentarily returned to the mean, it still seems to be trending upward, and subscribers are sure to as well.

Commitment to Customers

So, what? That’s not understanding and trust. The price increase is just a money grab, right? Well, it’s a little more involved than all that. The reason this model works and keeps working is that Netflix has a special rapport with its subscribers that most any business envies. The voice of the customer has spoken, and bigger, better content is what we all crave. Netflix has listened and is on an absolute warpath when it comes to cranking out original content. Spending $12 billion and producing roughly 1,500 hours of the stuff in 2018 sends a pretty clear message that the folks at Netflix are doing their darndest to give us what we want.

The Lesson

Customers historically accept a price increase when they’re excited about a brand as a whole. Higher prices should be like a promise that quality will improve, but a customer base will only accept the terms if they trust that your business will actually make that happen. It’s important to monitor how your customers are feeling about your brand and your mission while being transparent and acting on your goals. Netflix has committed to doing that, and, even though some subscribers take to Twitter in protest for a brief moment, it seems that most accept the service is moving along with the price tag. Onwards and upwards.

 

The titans of tech consumerism are often on the media mainstage and for good reason. Business behemoths like Apple, Amazon, and Google cause markets to fluctuate and reshape entire cities, so naturally, when they do something, we pay attention. Often, though, we only think of the big picture or conversely, the micro-picture. “How will this affect the economy?” or, on the other end of the spectrum, “Do I need to worry about my new phone?” What we sometimes forget is that we can extract more relatable lessons from these giants. Many of their strategies, especially customer feedback, can scale for our own businesses somewhere in the middle. Let me give you an example.

The Giant

After a poor showing for the holiday season, Apple’s disappointing sales have been dragging it down. Consumers are much slower to buy new models these days. On top of that, the newest iPhone just didn’t excite the world as it usually does. Surely, other gadget goliaths smell blood in the water. This would be the perfect time to strike.

The annual Consumer Electronics Show is usually rife with competitors. Apple, for whichever brand elitist reason or the other, refrains from making appearances at the event. CES 2019 promised to be no different as tech fanatics swarmed to Las Vegas to see what everyone else had to offer. Despite its absence from the showroom, Apple found an ingenious way to cast a massive shadow over the event. On January, 4, right before the trade show, the Vegas skyline included a massive new billboard. A black advertisement featuring an iPhone simply reads: “What happens on your iPhone, stays on your iPhone.” The ad not only plays on the proverbial Vegas slogan, but it is a well-crafted reminder to consumers that Amazon and Google are embroiled in data security controversy.

The Lesson

So, other than being a deliciously cheeky ad campaign, how does this apply to the layman in a business sense? Apple didn’t withdraw and pout when its product didn’t perform well, it regrouped and dug deep for what the customers really care about. Recent surveys show that smart device sales are slowing largely in part due to concerns over privacy and security. Apple has long cultivated a customer-centric culture, and its Net Promoter Score is shockingly high for the industry. So, as always, the customers spoke, and Apple listened.

This case just goes to show that staying ahead is not necessarily about having the biggest and brightest new-fangled product or service, it’s about understanding what the customer wants. Rather than spending a gut-wrenching amount of money on a new product or renovation, gather actionable customer feedback. Having the right feedback strategy can reveal very nuanced pain points for your customers. Apple has the luxury of armies of consultants and oceans of data, but that doesn’t mean we can’t follow suit. Customer feedback is scalable and vitally important. Customers will be more informed and more willing to switch brands based on price in 2019. If you’re not continuing dialogue with your customers and nurturing those relationships, your competitors have all the more room to elbow their way in.

Apple received tons of media coverage and social media buzz about the ad which quickly overshadowed the poor sales season. And hey, at the risk of invoking cries of “correlation not causation,” I’ve got to point out that its stock bounced back too. The day after the billboard went up.