How does Netflix always know just the right thing for us to watch? In this Infographic looks at how Netflix uses big data to find out what we want to watch quickly When you open Netflix you’re presented with options of things to watch in the form of rows and these are generally tailored by the big data that Netflix has accumulated on your activity. Netflix knows that if you don’t find you want to watch quickly you’ll go elsewhere so they spend a lot of money ensuring that you do. They estimate that their algorithms save the company $1 billion a year in value from customer retention.
As far back as 2006, when the company was still largely a DVD mailing business, it offered a prize to the people who could come up with the best algorithm for predicting how customers would rate a movie based on previous ratings. The winning algorithm has been revised many times since then, but the key elements remain the same. Netflix collects data on a wide range of different events and analyzes even small things such as if the nature of the show changes depending on what device you’re watching Netflix.
They even used the data to make the House of Cards series as they knew it would be popular based on their research. They knew that their audience would found the show interesting before they even started producing episodes which are truly amazing.
If every time you went on Netflix you had to trawl through the entire catalog it would be close to impossible to find anything to settle on and watch. What you want are recommendations based on what you’ve previously watched, and this is where the personalized video ranker comes in. The rows of shows on every member profile are different and it is based on all the data Netflix has gathered about your viewing habits. The video-video similarity algorithm is another good indicator as if you liked one video it is very likely that a similar video will also be enjoyed.
Netflix has truly changed the face of television and they use big data more effectively than any of their competitors. It will be interesting to see how Netflix further develops over the years to come and if other streaming platforms can catch them. Check out the full Infographic developed by team "Frame Your TV" now for more information on how Netflix uses big data.