A report from Citigroup had revealed about 3 months back that the video- subscription service was boosting the customer satisfaction rate at Netflix Inc. (NASDAQ:NFLX), pushed the stock higher by 10.84% to $62.58. This is a record for the highest intraday jump since July. Stock price had declined 19% through October.
Customer satisfaction rates had been troubling Netflix for quite some time ever since the prices were hiked in 2011 for users who both stream videos and get DVDs by mail. Later on the two divisions were separated and a survey of this quarter among 3,800 Internet users from US, has revealed that the percentage of “satisfied and very satisfied” customers adds up to 48%.
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Citigroup analyst, Mark Mahaney, who gave a buy/high risk rating, stated that Netflix is positioned favorably in terms of competition and respondents referring to the company’s name as a best destination have gone up from 25% to 35%. The selection of streaming content has been upgraded – 37% respondents have agreed to the quality being improved in one year.
Previously, Netflix had targeted an addition of 7 million users by the year end, but the possibilities were not promising at all in the month of July. Chief Executive Officer Reed Hastings had admitted that the goal would be even more challenging if the growth rate in the 3rd quarter failed to catch up. Netflix still has to content with rivals like Redbox, a joint venture between Verizon and Coinstar and Amazon’s Prime streaming service.