Something interesting about scarcity
We used to have a 6-at-a-time Netflix plan. We’d get 6 movies, but then sometimes we’d go months before watching them, or even just deciding that enough was enough and sending them back. And frequently, even among those 6 movies, there would be nothing we wanted to watch on any given night. And then an interesting thing happened. As part of a general cost trimming in our house, we dropped down to a 3-at-a-time plan. And suddenly we started watching a lot more Netflix movies. With 6 movies to choose from, there was always “something else” to watch, and we didn’t have to worry about clearing out all of the cruft to make room for something we really wanted to watch. As a result, we didn’t think as carefully about whether we’d really want to watch a new movie, because just renting something wouldn’t really block something else that we wanted to see more if it came along. But when we introduced a little artificial scarcity into the mix, a slot became something worth protecting from something we didn’t really want to see, and we started thinking more about which movies to put to the top of the queue, and then actually being more aggressive about watching them and sending them back.
This seems like a strange effect to me – we’re paying less, we’re technically using less (3 out instead of 6 out), but we’re turning over more, so the net effect is probably that we’re heavier users now than at 6-out. Because the pricing is only on the number out instead of the turnover, we’re unarguably paying less and using more, even though we’re technically on a “lower usage” plan. At this point, even if we wanted to spend the extra money, I have no desire to go back to a 6-out plan, because I like the extra sense of urgency that comes from having the out slots be a scarce resource, and it makes me want to use the service more.
I don’t know if this makes me a better Netflix customer or not, from their perspective. Obviously I’m paying less money to them per month and using more in mailing fees, but I’m also holding onto premium movies for a lot less time than I used to, freeing them up to be sent to other customers.
Anyone notice the same thing?
July 22nd, 2009 at 4:47 pm
We had a similar experience, and ended up just ditching Netflix entirely. It got to be somewhat stressful to kinda think about whether or not we were breaking even in terms of how many movies we were watching from there vs how much it’d cost to get the same amount from Blockbuster down the street. Stressful for me because I think too much about crap like that, anyway.
I have little need to see stuff immediately though, so putting a movie on hold at the library isn’t a big deal for me. I’m number 515 in line for Benjamin Button.
August 9th, 2009 at 6:20 pm
there’s a book about this called The Paradox of Choice: Why More is Less. I heard about it on the NPR program Radio Lab yesterday– which had a show devoted to how humans process choices. Interesting stuff.