House of Netflix

Good day explorers!

When you’re a successful pirate such as Jack Sparrow in the entertainment business, there is no such thing as a sure thing when it comes to starring in that next oscar nominated film. You can have a legendary director, a hollywood star and a popular concept and still, it’s just a roll of the dice.

However, in the case of Netflix and its successful series ‘House of Cards’ this was one sure bet.

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House of Cards, directed by David Fincher, starring Kevin Spacey and based on a popular 80’s British series is the most streamed piece of content in the United States and 40 other countries around the world. For any television series this would be applauded as an enormous achievement, and heading into its fifth season it comes as no real surprise to those at Netflix who knew all along that this show would be a major hit before the first episode even aired. How’s that you ask?

 

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The term big data refers to the collection and analysis of information at an abnormally large scale. Bigger than any research or analytics firms could even fathom. For businesses, this means that they receive information that they can utilise to develop greater understanding of what consumers want and consequently tailoring their products and services to better reflect their customers’ needs and wants.

From the reading ‘Big Data: A Management Revolution’ by Andrew McAfee and Erik Brynjolfsson I understood that Big Data can be classified based on three characteristics, its extensive variety, large volume and the velocity at which the data is processed. Once big data is recorded it’s typically used and stored in the cloud (a wireless network). It’s impossible to store it physically due the volume of characteristics it holds. Marketers can then access this data whenever they please to help quantify their marketing decisions whilst also comparing it to small data.

Rapid advancements in technology are shifting our assumptions from market research figures to analysing behaviours and consumers consumption patterns that ultimately lead us to make better marketing decisions using Big Data. Big-data sources are often linked to social media data exclusively, but can also include RFID data, logistics, production, and retailer scanner data – even weather or traffic patterns. Big data is about integrating data and analysing patterns. Big data is not concerned with collecting the data – that’s because in today’s internet of things, data is abundant. Marketers are able to generate real time information about actual behaviour apposed to fictitious information about peoples intentions. With a smaller margin for error, marketers are able to make more rationale based decisions on accurate and useful information.

The access to big data will no doubt surpass big research. Big research is limiting due to its small sample size, relevance, complexities, outdated methods and change. Whereas, Big data allows researchers to much larger pools of data faster than ever before in which marketers can find little hidden gems.

Consumers benefit from the collection of data usage because marketers can offer them more relevant products and services based on their actual behaviour and improve their user experience. Consumers are more likely to get products and services that are personalised rather than companies making products or providing services they have no use for. Where it gets tricky is when consumers start to feel as if their privacy is being violated by implicitly being exposed to unwanted marketing material by companies who have access to this goldmine of information.

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Netflix, which boasts 27 million subscribers in the USA alone and 33 million worldwide, had an enormous pool of data and decided to run the numbers. They found that a monumental share of users had streamed the work of David Fincher, the director of “The Social Network,” from beginning to end. Films featuring Kevin Spacey were always popular, as had the British version of “House of Cards.” With those three circles of interest, Netflix was able to find a Venn diagram intersection that suggested that buying the series would be a very good bet on original programming.

This successful bet paid off all because Netflix decided to utilise its access Big Data, and no one has more information on their audience than Netflix. A third of the downloads on the Internet during peak periods on any given day are devoted to streamed movies from the service, according to Sandvine, a networking provider. And last year, by some estimates, more people watched movies streamed online than on physical DVDs.

Since the inception of Film and television producers have always used data, holding previews for focus groups and noting the results, but as a technology company that distributes and now produces content, Netflix has mind-boggling access to consumer behaviour in real time.

How much data does Netflix really have access to? According to GigaOm, Netflix looks at 30 million “plays” a day, including when you pause, rewind and fast forward, four million ratings by Netflix subscribers, three million searches as well as the time of day when shows are watched and on what devices.

Through Netflix establishing a direct relationship with consumers, it is able to understand what people like to watch and that helps them in understanding how big the interest is going to be for a given show. It gives them some confidence to know that they could find an audience for a show like ‘House of Cards.’ ”

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Netflix annotate its entire library of content with hundreds of tags — metadata descriptors — tagged by users to describe the talent, the action, the tone and the genre, among many, many other things. Netflix use those tags to recommend other shows that users may be interested in, essentially building profiles based on the preferences of individual subscribers. But now Netflix is releasing its own original content because it knows what people want before they do. You could say that in a away there are 33 million different versions of Netflix.

Netflix has always used data to decide which shows to license. Netflix targeted its “House of Cards” trailers at a diverse following. Users who watched content with Kevin Spacey were exposed to promotional material with him, women watching “Thelma and Louise” saw trailers featuring the show’s  lead female character and those who regularly streamed movies saw content directed by David Fincher.

Based on that information, Netflix bought “House of Cards.” The success that they have experienced from the channeling Big Data also assisted in producing other Netflix hits such as “Unbreakable Kimmy Schmidt” and “Orange is the New Black”. Both of which have received numerous awards and have been renewed for multiple seasons. It’s definitely not one time luck!

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It’s sceptical to say that “House of Cards” has been a hit for Netflix due to it not participating in traditional television ratings. Its real effect has been spread far and wide throughout social media – in terms of its following, social media talk and the buzz it creates around new series. The show has also featured on the front page of The New York Times and The Los Angeles Times, and was on the cover of Emmy magazine. With Netflix providing content like this for as little as $7.99 a month for streaming — there will be no shortage of customers demanding the service.

 

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It’s clear that Netflixs’ series “House of Cards” was a product of logic and algorithms as opposed to tradition and instinct. The use of Big Data in television and film will help producers grasp a better understanding of user data and the potentially big impact it may have on how things happen in television. Data can only tell you what people have liked before, not what they don’t know they are going to like in the future,”. If the industry is suddenly going to rely on analysing Big Data to find the next big series then they are looking in the wrong place. Big Data has the potential to reduce the creative craftsmanship that comes with creating a unique program. Not one that has been a product of picking and choosing different characteristics. It’s important to understand consumers behaviour and full the missing spaces within their psyche that aren’t currently being filled by an existing television show.

Netflix’s access to this pool of data should be used to improve its products and services and make the experience of using Netflix more enjoyable, which I believe it is doing by creating a demand for new series, providing access to old shows and movies for consumers whilst tailoring personalised content. It could potentially cross the line when Netflix begins to use our personal data to market products and services to us, or worse sell it onto advertising agencies or big technology companies who could potentially use this to target us daily. This is where users begins to question a violation of their privacy and constant surveillance.

Netflix’s command over data isn’t entirely accurate. From my own personal experience, It suggests I like content such as “Keeping Up With The Kardashians,” which I don’t, and it believes that I would even consider watching kids animated movies, which I am not (maybe I’m not being entirely truthful about what I’m watching). However, when it came to guessing if “House of Cards” might appeal to me — politics, media and David Fincher all appeal to me.

After being exposed to all of the social media buzz and the recommendations by my friends, I found myself in my bedroom, perched up on my laptop, surrounded by empty food wrappers and university assignments, wondering when I the next season came out. I was hooked.

Netflix’s knack for recommending shows or movies also serve as concerns that the same thing that makes Netflix so unique — it knows everything about us — could create problems if it is not careful with our data and our privacy. On one hand it’s tailoring content and making our experience with the service much more enjoyable but on the other is the constant surveillance of our privacy being violated as well as creative and unique television as we know it being manipulated by data and catering to what producers think we want to see?

 

Until our next adventure,

Benjamin Deville