Is This Netflix Promotion Pure Genius or Incredibly Stupid?
Jun 19th 2012 8:07PM
Updated Jun 19th 2012 8:08PM
When I opened my email on Tuesday morning, Netflix (NAS: NFLX) had a little surprise waiting inside.
A promotion from Google (NAS: GOOG) Offers carried this headline: "$1 for 2 movie tickets when you watch TV shows and movies with Netflix."
What the ... ? Netflix doesn't sell tickets for anything, right? The service is all about streaming movie subscriptions. You don't buy, rent, or otherwise deal with anything even remotely like movie tickets on Netflix. Did the company just start a brand-new pay-per-view service?
The answer is a categorical "no," of course. But what Netflix actually is doing here speaks volumes about the company.
The Google offer bundles a Netflix trial with two tickets to your local movie theater. Watch three movies online, and then wait for some honest-to-goodness movie tickets in the mail.
What Netflix is saying here is that this service will satisfy your back-catalog needs, but we're happy to send you elsewhere for fresher fare. Now that I've seen this movie-theater tie-in, I wouldn't be surprised to find Netflix trials baked together with Coinstar's (NAS: CSTR) Redbox vending machines.
After all, Netflix doesn't give two hoots about protecting its own DVD-mailing business, because the future is all digital. If a handful of Redbox rentals inspires consumers to take Netflix streams for a spin, Redbox can have the early-bird sales all to itself. Netflix simply plays in a whole 'nother sandbox.
Netflix makes up the cost of two movie tickets in about three months. The free tickets won't ship until you've kicked the service's tires a bit, and it's a fair bet that prospective subscribers already have the hardware to watch Netflix in the living room. All told, this is a clever bit of marketing. Netflix clearly doesn't mind thinking outside the box to repair the brand damage taken in the Qwikster debacle.
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At the time this article was published Fool contributor Anders Bylund owns shares in Netflix and Google and has also created a bull call spread position on Netflix. He holds no other position in any of the companies mentioned. Check out Anders' holdings and bio, or follow him on Twitter and Google+. The Motley Fool owns shares of Netflix and Google. Motley Fool newsletter services have recommended buying shares of Netflix and Google. The Motley Fool has a disclosure policy. We Fools don't all hold the same opinion, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.
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