Survey shocker: people weren’t happy with Netflix this year

Just in case a mass exodus of subscribers and venom spewed in the comment sections of its official blog wasn’t enough proof that Netflix has fallen out of favor, a new consumer survey paints the streaming video giant as a company out of touch with what its customers want and how to treat them.

Survey shocker: people weren't happy with Netflix this year

Customer analysis group ForeSee released the results of its annual e-commerce satisfaction index this week, revealing lower-than-usual scores for Netflix’s site functionality, content and more. The Los Gatos company fell 8 percent in overall satisfaction to a 79 on the firm’s 100-point scale, surpassing similar declines by TheGap.com (six percent to 73) and Overstock.com (five percent to 72) to earn the dubious honor of biggest drop-off.

“Netflix totally misread its customer base and is paying the price, damaging its brand among both consumers and investors,” said Larry Freed, president and CEO of ForeSee. “Raising prices by 60 percent and splitting the baby into separate DVD and streaming services totally undermines Netflix’s cost and convenience advantages.”

Since customer satisfaction often determines a business’ success, Netflix’s turnabout could spell trouble in 2012, Freed added.

Wedbush Securities’ Michael Pachter predicted this month that Netflix’s missteps could lead to bottomless losses in the new year. “Any five year-old can tell when something isn’t fair, and raising prices on the DVD plus streaming customers only to acquire more content for all streaming customers wasn’t fair,” he said.

Netflix increased the price of its DVD by-mail plus instant streaming package on September 1 to $15.98/month, driving away over one million subscribers. The subsequent apology from CEO Reed Hastings and a failed attempt to split the company’s DVD operations into the ill-named Qwikster tested the resolve of even the most devout Netflix members.

One thing’s certain: Netflix has 12 months before ForeSee’s next survey is published, and numerous wrongs to right. (via Hacking Netflix)