Netflix’s Former Customers Are Returning After Rebranding Fiasco

At a J.P Morgan conference held in Boston on Wednesday, Netflix CFO David Wells said that the company was looking up and, more importantly, customers who cancelled the service because of the Qwikster rebranding, plan repricing, and subsequent poor PR are now returning.

The company drove users away due to a considerable price hike on its cheapest disk plan – from $9.99 to $15.98 – as well as its ham-handed decision to split the company into a streaming arm – Netflix – and a disk-in-the-mail arm – Qwikster. Wells said:

We think there’s room to grow, but the improvements in retention and our growth in Q1 and Q2 since Q3 and Q4 of last year make us feel pretty good. Rejoined or folks rejoining the service still remain about a third of our new subscribers that are coming in.Even streaming-only subscriptions, who should not have faced an impact, reacted to last year. We think that’s a result of the negative PR, the swirl that was around the brand and the company will dissipate over time. We even saw that in Canada, which you could argue should not have seen it.

Netflix pricing is currently set at $7.99 a month for one DVD (not Blu-Ray) disk out at a time a month and $16 for unlimited streaming and one disk. The steady return of disgruntled customers is a testament to the breadth of Netflix’s streaming selection and general economic improvements.