Netflix Penalizing Frequent Renters?

Hacking Netflix reader Darrin sent me this e-mail:

I know there is a slowdown in NetFlix’s shipping due to holidays; the last being Labor Day.  There was a delay last week of almost five or six days due to the holiday.  I mailed back two DVD’s on Monday September 20, they go to the San Jose, CA distribution center.  For some reason I did not get a confirmation until Thursday the 23rd and one of my queued films on Friday the 24th.  Is there some type of slowdown for those of us who watch and immediately return our DVD’s?  I am disabled and these DVD’s are my in-home entertainment. 

This question has dogged Netflix for a long time. I don't think they're doing it on purpose -- in this case a majority of the 2 million (and growing) members are all trying to have fresh flicks for the long weekend. If you remember the lines at video stores on holidays, think of what Netflix is going through (all of those movies being are being handled by only 30 distribution centers).

Then there is the Web site from last summer that did this in-depth research (complete with impressive-looking charts) into how they allocate new releases at http://dvd-rent-test.dreamhost.com/. I think it's finally time that they update the site or take it down. I have 264 movies in my queue and only two are on long or short wait. That's a huge difference when compared to last summer.

I have been reassured by sources at Netflix that they are NOT penalizing frequent (I think of myself as obsessive) renters, and with the exception of holiday weekends or the opening of a new distribution center, I'm a lot happier with Netflix now.

What is your Netflix experience?

Comments

[Scott]

Yup, I'm happier with Netflix today than I have been in the nearly 6 years(?) that I've been a member. I get my discs in a single day and only rarely is anything even a short wait. Kudos to Netflix; I haven't rented a movie from a bricks & mortar store since I worked at Tower Video three plus years ago.

[anonymous coward]

Others have speculated that the more turns you get the more likely you are to get 'long wait,' or to get titles shipped from remote hubs. I won't comment on that.

But I think it's astonishing that everyone is quick to blame Netflix for shipping delays. Folks, read your email! You get one when a disc arrives and when one ships out. The time between you giving the disc to the postman and you getting the email that it was received it is in the hands of the U.S. Postal Service. The same holds for the time between you getting an email that a disc was shipped and the disc arriving in your hands.

What would the benefit be for Netflix to sit on sacks of incoming mail? That would merely decrease the number of available discs for those whose discs did arrive.

[LWK]

I've never been suspicious of any sort of conspiracy regarding Netflix's service. I did have a few shipping "glitches" early on in 2002, but nothing as of late. Since my distro center is now in my city (Austin, TX), it hasn't taken more than 1 day in either direction (sans weekends).

Frankly, I wish other companies I do business with would take a customer service lesson from Netflix.

[Becky]

I experience rapid turnaround most of the time.

[Dan Crevier]

I have virtually nothing with a wait, and I've had a quick turn around time lately, so it doesn't seem like I'm being penalized. However, I did coincidentally have a couple of things take longer last week.

[J]

I experience virtually no wait with my 8-out plan! I'm very happy with them.

[Nate]

If I stick the disc in the mail on a Monday, I have a new disc by Wednesday, usually.

[M-Class]

I don't know... I tend to be suspicious sometimes. In particular, for me the 'mail delay' always seems to be going from me to Netflix. I've had numerous problems with Netflix acknowledging the arrivial of something I've sent back, but I've never had any problems with the amount of time it takes them to ship me something.

Example given:
Monday this week I sent a DVD back to Netflix from Nashville, TN to Bowling Green, KY (should take one day). On Friday (4 days later) I get the arrival confirmation and the notice that my next title has shipped. The next DVD is received in my mailbox on Saturday.

If this happened occasionally, I'd tend to call it an anomoly, but this seems to happen frequently and isn't attibuted to a single shipping center either (I've been with 3 in the past year). Many times I've sent back 3 discs at once, and two will arrive back at Netflix precisely on time, but the last one will mysteriously take 3-7 (or in one case 14) days longer before Netflix acknowledges its arrival. On the other hand, everything they send out always arrives here on time.

I've sometimes questioned if Netflix convinently doesn't acknowlegde the receipt of some of my returns rather than to show a wait on a title.

[anonymous coward]

Wonder no longer. Never happens.

[Jonathan Arnold]

I noticed a very long delay a few weeks ago myself. I am not a frequent renter - maybe 5-6 films month - and this was the first time I noticed a lag of more than a week between dropping the movie off and getting it. Nothing major.

I was an early adopter of Netflix, but dropped it due to the long delay between getting new movies. When I saw they opened up a Worcestor center, I joined up more than a year ago and have been very happy. Normally it is about a 5 day turnaround.

Seems like every so often the turnaround time for me turns from 3-days to 5-days (not including weekends) for a few movies worth of returns. Could be coincidence, but it tends to happen more often when I'm rapidly turning through my queue - although this might be psychosomatic, in that I'm more tuned to noticing such things at those times.

However, one thing that *does* bother me is that some of the movie-return envelopes have a little yellow/black "caution"-style highlighting on them, and others don't. Again, it might be coincidence - any I have yet to actually correlate any perceived delayed-shipping times with using the non-yellow return envelopes - but it does appear as though Netflix's turnaround time is faster with the yellow-highlighted returns...

Anyone have any idea what this difference in return-envelopes signifies? It's gotta mean _something_...

[Carl Cravens]

Anonymous Coward,

How do you know "it never happens"? There may be no benefit to Netflix sitting on bags of mail (a debatable point), but if they just don't have the hands to handle the volume (someone called in sick, the volume is unusually high, etc), what happens. You've got X discs in the mail bag, you've got enough hands to process X-500 discs... do those 500 discs get magically processed, or do they sit there until the next day? I suppose Netflix could have a "you don't go home until they're all processed" policy.

But if those 500 sit there until the next day... now there's an extra 500 on top of the unusually high volume, or that "sick" guy calls in to say that he quits. Now we're 1000 discs behind, and it's going to take the unusually high volume to subside, or to find a replacement for the guy that quit. It would take some time for this to smooth out.

I don't know that there's anything malevolent going on at Netflix, but I do know that shipping to me is a very solid two days, while shipping to Netflix (from the point I drop it in the mail to the point they acknowledge it's arrived) averages 2.7 days (I keep a log), sometimes as quick as just one day, sometimes ranging to three, four, five or even six days a couple times. It's usually two days, but the variance is much higher on return mail than mail to me.

Is the Post Office that random going back to them and that reliable coming to me? (Does pre-sorting the mail make that much difference?) Or does that wider variance back to them indicate the ebb and flow of processing discs through the warehouse?

[Darrin E. Buth]

Since I started this debate of sorts, I received last week on Friday 9-24 "Just Married," 2003, Saturday "8 Mile," 2002, and today Monday 9-27 "Bend it Like Beckham," 2002. These three DVD's are not new releases and the previous three DVD's I returned were on Monday September 20, 2004 from the Turlock Post Office.

This has happened before, there was no e-mail saying there was a delay, there was nothing listed on my queue saying a short wait. I would rather have the speed of returning a DVD on Monday and seeing a new one in my mail box on Wednesday.

[Derek]

I am relatively new to Netflix and I live approximately 90 miles from my distribution center. It normally takes 2 days for netflix to receive my mailed back movies and 2 days for me to receive them from Netflix.

I tend to watch them the night I receive them and send them back the next morning. My son had a football game on Sunday in a town that was only 30 miles from the distribution center so I brought my 3 movies with me and mailed them at the box in front of the post office, figuring they would be picked up on Monday at 7:30 a.m. and probably get to Netflix that day or at the most on Tuesday. Well Monday and Tuesday have come and gone and they still show no sign that they recived my movies and they were mailed a mere 30 miles from the Distro center ??? How is that possible that they would not have received them in 2 days?

I like the service but really wish there was a little quicker turnaround time to make it more economical. I am curious do most people get the 3, 5 or 8 at a time and is it a better deal to go with the 5 at a time rather than 3?

Thanks

[Aron]

I think it's very difficult to not get your money's worth from the Netflix plan (even if you averaged weekly turnaround), so if you are running into situations where you aren't getting enough movies then upping the plan to 5-out is preferable to pointless frustration IMO.

[Manda]

Tired of shipping delays and with my 6-month discount coming to an end, I cancelled Netflix earlier this month. In the last two months of the subscription every DVD arrived here in 1-2 days, but in the other direction I had several discs take 5-6 days to travel just 100 miles. That can't be a coincidence. The one that took 6 days had been reported as damaged. It's almost as if they were penalizing me for receiving cracked disc.

I'm with Wal-Mart now. Although they don't have Netflix's selection or nearby distribution centers, at least their shipping times are more consistent (2-3 days generally), and it certainly helps that I can get 4 DVDs for the same price as Netflix's 3-out plan.

[Derek]

Just thought I would follow up my previous post to say that Netflix finally received my 3 movies today, Thurs. 9/30 that were mailed from the post office of a town 30 miles from the distro center 5 days ago. I also took Arons advice and upped my account to 5 at a time so I will see if that works any better. Again love the selection, the ease of mailing rather than going to BB and waiting in line, but would like to see a little quicker turnaround time with Netflix.

[mnkyboy]

Please give me some tips. Netflix sent me (3) dvds on the same day, 9-27, and I still havent recieved them. I live in the New Orleans area, and it usually only takes about 2 days to get to me at the most. Last time this happen, I did the "DVDs havent arrived" send me them again thing, and I recieved them all the next day. The first time this happen to me, about 2 yrs ago, the original dvds never showed up, only the replacements.

Im skeptical that they will arrive tommorow, but keeping my fingers crossed. I decided to log one of the dvds as "DVD hasnt arrived", send me a replacement. I will do the others tommorow if they dont come in.

So, how often does this happen? Supposedly theirs a new distro center in Baton Rouge, LA, which is about 1hr from New Orleans. If this is the case, maybe they are backed up?

What would you do regarding my situation above?

[Jason Moon]

I had been a member of Netflix for three months and I HATED it! These half wits could not get a damn thing right! I never received half of my movies but man they had no problem charging me $20.00/month for this poor service. They are a rip off! I have cancelled my service with them and am considering reporting them to the Better Business Bureau. I could never get in touch with anyone. ALL of the e-mails I sent to these jack legs came back "undeliverable". A freakin con if I ever saw one.

Jason Moon

[OttoMuller]

First two months the service was impeccable. After those first months delays were a common thing. I am sent movies that do not follow the queue priority at all. I am sent dvds that are 'available now', but only after 2 to 6 days of they receiving the ones i send back. I send two or three dvds in the same envelope, but they acknowledge their getting them in different days. I sent emails to their customer service that were never replied. I do think they are punishing frequent renters.

[Scott]

First 2 months was great with 2-3 day turn arounds (there's a dist center here in town). Then suddenly they jumped to around a week, or more. Punished for frequent viewing? Sure looks like it.

Why would they do this? Simple economics. Frequent renters require a bigger pool of movies to satisfy demand.

Some have asked why NetFlix would sit on movies they've received. I'm sure they don't - need to get them into the pool ASAP. However, that doesn't mean they send out the "we've received" email immediately when they log in the DVD. It's simple to write the software so as to delay sending out the "we've received" emails for a couple of days for frequent renters and then delay the shipping of the next movie until the day after the email is sent.

But does it make economic sense? Of course, unless people like me quit as a result of the delays.

Are they actually doing this? No way to know without inside info - but sure looks like it...

[BoB]

I agree Scott. I'm leaving NF when my month is up and using BB. Better ship times, cheaper & 2 free rentals I can use for games.

[Gabe L]

You may not know this but Netflix has a "priority" status for people that are light users. I read that on their site.
The logic according to NF is that giving priority to light users evens up the experience to that of heavy users (sic).

So yes , if you are a heavy user (3 movies a week on the 3 plan or more) you fall to second class statue. I'm not sure what that means but my guess is that you get lower priority for hot releases and that your churn time is slowed down. It regrettable that NF cannot extend the quality they gave me in the tryout period to the rest of the time.

Furthermore, the average rental for NF is 5 DVD's per month for the 3 plan. So they make $3.75 per DVD, not bad considering that they have a very low overhead(compared to a video store). If you rent 12 movies a month they only make $ 1.80 -+ per movie that hurts their bottom line, so I'm not surprised to see delay tactic built into heavy user's accounts. too bad.

From the Netflix site:

"In determining priority for shipping and inventory allocation, we give priority to those members who receive the fewest DVDs through our service. As a result, those members who receive the most movies may experience that (i) the shipment of their next available DVDs occurs at least one business day following return of their previously viewed movie, (ii) delivery takes longer, as the shipments may not be processed from their local distribution center and (iii) they receive movies lower in their Queue more often than our other members. By prioritizing this way, we help assure a balanced experience for all our members. Those that rent a lot of movies get a great value and those with lighter viewing habits are able to count on our service to meet their limited needs."