Reed Hastings, founder and CEO of Netflix was profiled on the CBS news magazine "60 Minutes" this past Sunday. Thanks to the magic of TiVo, I'm just catching up with the interview now.
There were no real surprises here for anyone familiar with Netflix or online DVD rentals, but the segment did provide another inside look at a Netflix shipping center. There we learned that the workers who stuff the mailing envelopes - the hotshot shown on "60 Minutes" does an astonishing 1,000 an hour - are required to take mandatory exercise breaks every 90 minutes to help keep carpal tunnel syndrome at bay.
The employees are also still wearing the red Netflix tee shirts we've seen in other television reports, although I believe this may be a different distribution center (and/or the shirts have been washed since last February).
Hastings explains how he came up with the idea for Netflix in this transcript from the CBS website:
"I was hoping you wouldn’t ask that, because it’s a little embarrassing! I’d rented a VHS and I had misplaced it and it was six weeks late. So it was a $40 late fee. I remember ‘cause I didn’t want to tell my wife. Because you know I knew what she would say."
What would she say?
"Just like, you know, an eye roll. An eye roll that could kill! And I thought, 'Oh, great! Now I’m thinking about lying to my wife about a late fee and the sanctity of my marriage for this thing!' I mean it was just crazy. And I was on the way to the gym and I realized – 'Whoa! Video stores could operate like a gym, with a flat membership fee.' And it was like 'I wonder why no one’s done that before!'" Hastings explains.
For Hastings, it was the eureka moment.
Most movies were still on VHS nine years ago, and VHS tapes were too bulky and too expensive for the mail. Then a friend told him about a new technology called the DVD and he wondered if those might be a viable option.
"I ran down to Tower and bought a bunch and mailed them to myself and then I waited," Hastings recalls.
He wanted to see if they would get destroyed in the mail. "And I opened them up. And they were fine. And I thought, 'Oh my God. This is gonna work! This is gonna work!'
I'm sure they picked up a bunch of new subscribers from all the publicity, or at least received a lot of visitors to their website. Hastings was a good corporate representative and had all the right answers to all the difficult questions, except for one.
We'll tell you about Reed Hastings' big gaffe after the jump.
[Previously: Secrets of Netflix Distribution Centers]
The "60 Minutes" report introduced us to a couple in Northern Maine - Bob and Bobbi Henkel - who are big fans of the service, but who had a few problems along the way with delivery of their discs. They wanted to call to express their frustration, but couldn't find a phone number for Netflix anywhere on the site.
When correspondent Lesley Stahl asked Hastings about that, he responded, "I’ll show you that here," and then clicked on the site which was already open on his laptop.
And then he clicked. And clicked again. And again.
He couldn't find it. "Ah… how do I contact customer service?" he asked, answering his own question by saying "Okay, it’s all by e-mail."
Well, no, it's actually not all by e-mail.
There is indeed a phone number for Netflix customer service - it's 800.585.8131. Call them Monday to Friday 9:00 AM-10 PM ET, Saturday and Sunday 9:00 AM - 5:30 PM, but, frankly, they'd prefer you didn't.
You see, the operational cost of an inbound telemarketing call can vary from 50 cents a minute (or less) to close to $2.00 a minute, depending on the complexity of the call and whether or not the CSRs are in-house or outsourced.
That's why Hastings couldn't locate the number. it wasn't there. (In a postscript to the interview, Stahl said the service has since posted the number, although I couldn't find it.)
They don't want people calling to ask why they don't have this movie or that or when such and such film is going to be released. And it's far more economical for them to handle routine customer service issues via e-mail.
That's fine, of course, if the e-mail support they offer is of a high caliber.
The one time I contacted Netflix via e-mail, however, it was not.
I, too, had a delivery problem. Netflix would say that they sent me DVDs, but I never received them. This happened several times. I did a little research and found a lot of confirmed online reports about theft at the post office near my Netflix distribution center. (This was several years ago, long before reports started popping up with great regularity about the theft of Netflix DVDs by postal workers.)
When I first reported the problem, the Netflix rep suggested via e-mail that I change the delivery address to my office. "DVDs go missing and you want me to simply change the address to which they're being delivered? What if the DVDs are being stolen?" I asked.
They're not being stolen, I was told.
Netflix has a crackerjack security team and we're aware of the very few places where there's a problem and your area isn't one of them. Change your address and your problems will go away!
Well, first off, how many people can do that? Not everyone has an office to which mail can be delivered. It's also not for Netflix to dictate where I would find it most convenient to have my DVDs delivered.
And secondly, why are you not paying any attention to what I'm telling you about the theft of your DVDs? Aren't you the slightest bit interested? What if (gulp) I'm right?
The Netflix reps who e-mailed me were polite, but they lacked a sense of urgency and spoke in pre-fab sentences that never really addressed my specific questions. This is a pet peeve of mine and, unfortunately, it's not uncommon with e-mail and IM customer support from many big companies.
To cut costs, the way e-mail customer service generally works is that a computer searches for common problems, questions, words and phrases related to your company's product. When it finds them, it suggests seemingly appropriate pre-fab sentences and sometimes whole paragraphs to a customer service rep, who then cuts and pastes them in.
I received such a response (from another company) just yesterday and it was clear the rep had absolutely no idea what my question was about and didn't understand all the ramifications. And that's exactly the way I felt with my back-and-forth e-mail correspondence with Netflix. It was a wholly unsatisfactory experience.
Since I couldn't get any DVDs delivered any other way, i did indeed change my address. But I missed that all important Saturday delivery and would have to wait till I got back to the office on Monday to get whatever would have been delivered on Saturday.
I changed back a short time later after I learned that someone was arrested for theft of Netflix DVDs at the post office serving my shipping center. I never had a problem again.
Comments