Netflix Fails... Again

Today as I sieved through the morning news, I came across a particularly funny PR predicament. The situation involved the decision for Netflix, Inc. to separate its online movie streaming service from its DVD-by-mail service. The name Netflix will remain for the online movie streaming sector. The DVD-by-mail however, will be ‘cleverly’ rebranded as Qwikster and will offer a more diverse service for a higher price.

What wasn’t remotely clever about this move was the blatant lack of research. Certainly they would want to utilize their massive following on Twitter, and would make sure the handle for @Qwikster was available? Apparently in their haste, CEO Reed Hastings and his team completely overlooked this.

Alas, it was taken. A foul-mouthed, seemingly illiterate pot-head allegedly named Jason Castillo had beaten them to the chase. Mr. Castillo, who typically posts about his bench press, smoking weed, and being “bored as shyt,” is portrayed in his display picture as Elmo from Sesame Street smoking a joint. The followers came in hoards. And of course, the online amusement ensued.

What makes matters worse? All this happened in the wake of their stock dropping nearly 50% since the company announced the split on July 12. I am only beginning my third week as a student of public relations, but I think we can all agree that this is some bad PR. Especially interesting was how Mr. Hastings approached the situation.

Mr. Hastings has since posted an apology both on his blog and as a video on Youtube. He does explain his decisions and justifies the price increases fairly well. He does not however, address the Twitter situation at all.

As students of public relations, do you think Mr. Hastings should be responsible for addressing such an obvious slip up?