“La Casa de Papel,” “Elite”… these are just some of the names on everyone’s lips, providing the perfect excuse for fun-filled sleepovers.
Behind these series, the video streaming platform Netflix constantly offers innovative content at optimized costs. The platform’s strategic choice is to maximize the quality of its offering through investments of nearly $8 billion for 2018 alone, exclusively dedicated to content production. This choice stands out from other companies in the sector: this amount far exceeds those of certain giants that have developed an entertainment offering (for example, Apple has earmarked a budget of nearly one billion dollars for the production of television series ).
Spectacular Global Results
The results are in: Netflix, currently established in nearly 190 countries, boasts nearly 130 million users, and by the end of 2018, is expected to have approximately 700 new programs in its catalog. This is enough to get a majority of viewers hooked. This approach has allowed Netflix to launch flagship commercial successes, such as Elite (a Spanish series), and a plethora of romantic series released during the summer of 2018, which alone helped gain nearly 7 million new subscriber accounts in the third quarter of 2018… 2 million more than expected.
Big Data as a Driver for Offer Personalization
Behind this success: Big Data. Netflix’s positioning and offering are the result of analyzing an immense amount of data (which viewer watches which series, favorite actors and directors, identification of devices used, etc.) allowing for precise determination from the script to production costs:
- For example, Big Data makes it possible to find the best filming location option based on costs and narrative requirements.
- Furthermore, the combination of this data alone determines judicious content, perfectly aligned with customer expectations: “House of Cards” thus features actor Kevin Spacey directed by filmmaker David Fincher, thereby aligning the tastes of viewers, who are fond of these two artists, in a single series.
- Marketing targeting strategies are also adapted: teasers and advertisements are personalized according to the viewer and their tastes, as analyzed by Big Data.
What lessons can be learned from Netflix’s success?
- Anticipation is a necessity: Netflix’s success does not come from its ability to conform to expressed expectations, but rather from anticipating them. Going even further, Netflix creates a craving, a desire not yet formalized, from a set of unorganized data.
- Personalization is essential: offers must multiply to perfectly match the profiles of your potential customers and prospects. To achieve these ends, having data is not enough; you also need the right tools to perfect the analysis and establish relevant frameworks for adapting your offering.
- A good product sells itself… and naturally gains market share: for example, Canal+ was forced to lower its prices (with an offer under 10 euros for young people) following the disaffection of its subscribers who preferred Netflix: in one year (March 2017 and March 2018), the group thus lost approximately 188,000 of them.