Some companies seem to understand the power of the internet. And some don’t really. And the difference between them is often random. Sure there are new media companies that “get” the internet, and old media companies that don’t, but the opposite is also true.
Often you’ll hear people talk about the power of the internet being in communication. The ability of one person, or one company, to reach out to thousands, millions of people all over the world. And while that is advantageous, for many companies the real power should be in personalization and customization. An area where many companies fail by not even trying.
Netflix is a company that does very well in offering consumers a choice of services. Something they’ve been doing, almost since the very beginning. They currently offer 11 different subscription plans.
From their $4.99 a month limited DVD plan, to their streaming only $7.99 plan, the $9.99 One DVD plan, all the way up to their 8 DVD’s at a time plan for $55.99 a month. Depending on how much you want to pay, and what you want to watch Netflix gives you quite the choice.
In addition, the streaming only plan and all of the DVD plans include unlimited viewing on any Netflix capable device. And that list is huge, Mac, PC, PlayStation 3, Wii, Xbox 360, Apple iOS devices, Apple TV, Google TV, other set top boxes, networked Blu-ray players, built in to select TV’s, and Windows Phone 7. Netflix lists 35 separate devices on it’s website.
Now lets contrast that with Hulu. A company that’s actually newer than Netflix. Hulu has two plans. There’s the free service and Hulu Plus, for $7.99 a month. Hulu’s free service has select shows from NBC, ABC, FOX, and a few others. Generally only the 5 most recent episodes, and the vast majority of them have commercials. Now because I’m not paying for the shows I understand why there are commercials. And since the commercials are only limited to only one or two per break I’m okay with that. Somebody has to pay for the content, and advertisers appear willing. The free Hulu service is limited to watching only on a Mac or PC.
Hulu Plus gives you every episode of current season shows, a large catalog of past seasons, 720p quality video, and the ability to watch on your Apple iOS device, PlayStation 3, select TV’s and set top devices, with many more coming soon. But, and for me it’s a big but, it still has commercials. That’s right, they want me to PAY THEM, to watch commercials. This is where the problem is. Would it really be that difficult or troublesome to have multiple plans, including some without commercial interruptions? I would pay more than $7.99 a month for the things that Hulu Plus offers if it was commercial free. But Hulu doesn’t want to give me that option. I suspect it’s because the owners of Hulu, the traditional major networks, are beholden to the advertisers, and not the consumer.
Often this “mistrust” of the consumer isn’t limited to just the parent companies. It can be seen in individual properties. Sometimes even switching from one end to the other. Take V, for example. The reimagined series began in 2009 and was broadcast on ABC. It was also available on Hulu, ABC.com, iTunes, and through the ABC iPad app. But when season 2 began in January of 2011, it was only available via broadcast. It is not available on Hulu, ABC.com, iTunes, the ABC iPad app, or any other legitimate streaming or digital service. And though ABC has acknowleged episodes will not be available online, they haven’t really said why.
Unlike Bones, which embraces the internet like few other shows. Bones can be watched
1. Broadcast live with commercials
2. Recorded from the live broadcast with my DVR, commercials can be skipped
3. The next day for free with commercials at FOX.com
4. The next day for free with commercials at Hulu.com
5. The next day for purchase, commercial free, from iTunes in HD $2.99
6. The next day for purchase, commercial free, from iTunes in SD $1.99
7. The next day for purchase, commercial free from iTunes in HD as part of the season $59.99 ($2.61 an episode)
8. The next day for purchase, commercial free from iTunes in SD as part of the season $39.99 ($1.74 an episode)
9. The next day for rental, commercial free from iTunes in HD $0.99
10. At the end of the season when it is released on DVD for about $30-$40
11. At the end of the season streaming on Netflix as part of your regular subscription.
12. As repeats or in syndication.
Twelve different choices, with a cost to the consumer from free to $60. Now I really like Bones, so I often watch it live, or slightly delayed, skipping most of the commercials in the first half. But I wouldn’t be watching it at all if it wasn’t for Netflix and iTunes rentals. Though Bones premiered in 2005, I didn’t start watching it until the summer of 2010. At the time Netflix had seasons 1-4 available for streaming and I watched them all from the beginning. But I faced a dilemma. Season 6 began before Season 5 became available on DVD (and Netflix streaming). I didn’t want to start watching Season 6 until I finished watching Season 5. Some episodes were available for online streaming through Hulu.com but not all of them. Then Apple introduced TV show rentals for only $0.99. I was able to get caught up, and now watch every episode.
Finally I want to talk about manufacturers. Most manufactures only make a limited selection of products. Take milk for example, it’s sold in quart, half gallon, and gallon sizes. Adding different sizes, or custom sizes would not significantly improve sales. I doubt there’s much demand for 3/4 gallon, 2 gallon, or 100 ounce sizes, for example.
But other types of manufactures could see a significant change to their business if they offered true customization. Car manufacturers are the perfect example. They currently pretend they offer choice to the consumer. But you can’t really get exactly what you want. Can I get a moon roof installed on the basic model? No, you have to get the bigger engine, and the navigation system too. Oh, you want the 4 wheel disc brakes with 17″ aluminum wheels? Well, that means you also have to get the premium surround sound and leather seats.
The car companies are still living in the ’70′s. They guess what people want to buy, make a lot of them, and hope they sell. It’s a one way, top down style of thinking. There is no reason, other than tradition, that cars can not be built on demand.
Why not send one or two vehicles to each dealership for consumers to look at and test drive, then set them down at a computer and let them choose the options and colors they desire. Send the order to the factory, the car is built and delivered within a week. No excess inventory, no huge end of season sales, the consumer gets exactly what they want.
In the end the world will change. Those companies and people that understand this will win. Those that continue to do things the way they have always done them will cease to exist.