Netflix: House of Data
Netflix recently released season three of their hit series House of Cards (HOC). The HOC series has been a huge win for Netflix; since it was released, Netflix’s stock has nearly tripled. With this overnight success one can’t help but wonder: does Netflix have their own Frank Underwood working for them?
Now, I am not implying they’re pushing anyone in front of a metro to get to the top; however, their $100 million investment in an original series was quite the gamble. It’s difficult for any company to shift away from their comfort zone and embrace new strategies.
Netflix deserves a Frank Underwood monologue moment. Breaking the fourth wall, and sharing its omnipotent wisdom. Explaining their long-term strategy game.
According to data from Internet intelligence company Procera, about 2% of U.S. Netflix subscribers watched the second season in its entirety the first weekend it was released. That’s 668,000 people who blazed through all 13 episodes in three days, more than Washington, D.C.’s population.
So how did Netflix beat other leading original programing providers such as HBO? Two words: Big Data.
Netflix understands the importance and role of big data for long term success. The company analyzes customers’ interactions, understands audience behavior and performs in-depth analysis on specific shows.
A highlight of some of Netflix’s metrics are: date watched, day of the week watched, when viewers pause, rewind and fast forward, where people are watching, time they watch….the list goes on. Check out Netflix’s Viewing Data: How We Know Where You Are in House of Cards to see just how far they go.
While Netflix gets a lot of credit for revolutionizing movies-on-demand, they also deserve kudos for understanding the value of a research- and data-driven approach to content strategy.
How did Netflix know to bet on House of Cards?
- A lot of users watched the David Fincher-directed movie The Social Network from beginning to end
- The British version of House of Cards was well received
- Those who watched the British version House of Cards also watched Kevin Spacey films and/or films directed by David Fincher
By combining and analyzing the information above, Netflix executives were given pretty strong insights that House of Cards would be a success with viewers.
Netflix is a very large-scale example of how companies can use data to optimize their marketing efforts. Though many businesses do not have the money, resources and know-how to understand and apply big data on such a large scale, by gaining an understanding of data and analytics, businesses of all sizes can lay the foundation for capturing insights and improving their offerings.
The core role of analytics is to help businesses gain insight into their customers. Analytics provide businesses the understanding they need to make better, more informed decisions. They then can optimize their marketing efforts and deliver a better product. Without analytics, companies are in the dark about their customers.