Many consumers weren't happy after Netflix (NFLX -0.86%) raised its prices earlier this year. The streaming service's most popular tier now costs $15.49 per month in the United States, more than any other popular competitor in the country. And many consumers say it's just not worth the money.

Netflix has the lowest percentage of satisfied subscribers based on the value they receive from the service, according to a recent survey from Whip Media. That suggests that in just a couple years, Netflix may have gone from one of the best values in entertainment to one of the worst.

Can't get no satisfaction

The percentage of Netflix subscribers that said they were satisfied with the streaming service fell from 90% in 2021 to 80% in 2022. That put it behind the other streaming services in the survey: Warner Bros. Discovery, HBO Max, Disney's Disney+, and Hulu.

When combined with the price increase Netflix implemented earlier this year, it led to a significant drop in the perceived value of Netflix. HBO Max notably tops the list of best values in streaming, according to the survey, with 85% of respondents saying they're satisfied with the value they get from the service.

Whip Media points out the juxtaposition in value perception among HBO Max and Netflix subscribers, since they're both priced similarly. The problem for Netflix is that it has a large group of unsatisfied customers. Twenty percent of subscribers report some level of dissatisfaction. Just 4% of HBO Max subscribers are dissatisfied. 

Thus, for a large group, Netflix is still a great value, but a growing group sees the opposite. The price increase seems to have weighed heavily on their perception. It was the No. 1 reason consumers canceled the service last year, followed by "I was not getting enough value from it." The latter response was also the top reason people gave for canceling HBO Max or Disney+, but those groups were much smaller.

Is Netflix's value actually declining?

For the purposes of this analysis, let's define value in streaming video on demand as the amount of quality programming you can access per dollar.

In that regard, Netflix offers more quality programming (based on IMDb ratings) than any other service, according to a recent study by Self. It has 795 titles in its library with an IMDb rating of 8.0 or above and 3,957 more with a rating of at least 6.0. By comparison, HBO Max has 463 8.0+ titles and 2,447 titles rated between 6.0 and 8.0. The two services offer a similar number of quality films, and Netflix has significantly more quality TV series. 

That said, the average rating for a Netflix title is closer to the bottom of the pack, while HBO Max delivers consistently quality titles to its subscribers. And that's, perhaps, the core of the issue Netflix currently faces. In its efforts to produce enough content to keep everyone satisfied, it's created a perception that it mostly makes mediocre or even bad content. That's even when it has more great content than anyone else.

Improving discovery on its platform isn't the answer either. In fact, Netflix still ranks higher than its competitors in terms of user experience and recommendations. Netflix is suffering from a perception problem. Even when it offers good value to its subscribers, they're comparing it to the value they used to get from Netflix before the most recent price hike.

Improving perception

Improving the perception of a product requires getting that message across to consumers. That is, Netflix needs to revamp its marketing.

Netflix's marketing budget is still below its 2019 levels. Increasing that budget to showcase the great content available on the platform may do just as much for keeping subscribers on the service as it does to attract new subscribers asking why they should sign up for Netflix in the first place. Its competitors are spending heavily to do it, and Netflix may need to do the same.

An increase in marketing spending would negatively impact operating margin, but Netflix can manage that spending in order to meet its margin goals. It already has tons of great content, so it can slow down on the annual content budget increases. Still, ensuring strong top-line growth is more important for the company right now than ensuring margins continue to expand at a regular pace.

Investors should watch to see how management plans to combat the subscriber losses and the negative perception its brand has following the recent price hike.