I remember my first encounter with Netflix. I was in high school. I was going to the local Dairy Queen with a friend when he casually said, “I need to return these Netflix rentals so I can get something new off my queue.”
Reading the confusion on my face, he explained to me that for $19.95 a month, he had access to unlimited rentals, provided he kept no more than three at a time. His queue was his wish list of DVDs. Once he returned a DVD, the next one on his list was sent to him. How intriguing.
I never gave Netflix much thought until I was living on my own. Realizing how expensive a cable subscription would be, I signed up for Netflix. By this time, Netflix had rendered most video stores obsolete. (Although I did recently visit a Blockbuster in Fairbanks, Alaska. Not a lot of new releases there…) Netflix had also dropped its price dramatically and introduced content streaming for PCs, gaming consoles, Blu-ray players, smartphones, tablets and laptops. I had an array of content at my fingertips.
I quickly fell in love with Netflix. Not only were some of my past favorite shows on there (hello, “Buffy the Vampire Slayer”), but current television shows were available, too. Netflix even produced its own original content called “Netflix Originals.” These shows and movies couldn’t be found anywhere else. It felt like I belonged to a special club.
But Netflix did more than give me the 90s shows I loved. Each time I logged into my account, I was greeted with programming suggestions that Netflix thought I would like. Not only was I finding new programs and movies to watch on my own, but now I was having things selected for me. I felt spoiled.
Netflix is clever. When someone subscribes, its begins tracking that person’s entire viewing history and patterns. But it doesn’t stop there. Netflix generates algorithms to infer taste preferences, which helps create a profile of suggested TV shows and movies for every user. (If you want to get really deep, check out the company’s Tech Blog.)
Netflix used its intimate knowledge of viewer behavior to create “Netflix Originals.” The probability of generating profitable original content was statistically high because the company understood what viewers wanted. A bit Big Brother-ish, but that’s the trade-off for good programming.
Netflix also used social media to join the conversations customers were having about the brand. A great example is when it parodied its own hashtag to promote a new Bill Murray movie: #NetflixandChill became #NetflixandBill. Or when it used YouTube to talk about not ruining episodes for those who haven’t had an opportunity to binge-watch the latest shows. (Seriously, who doesn’t respect proper Netflix etiquette?) Netflix proved that it knows what consumers are into and how to speak their language.
The way we view content is changing — there’s no denying it. Overall, I give the trophy to Netflix for understanding the customer base and making it the star of the show. By relying heavily on user data, Netflix has created a successful programming platform for a diverse crowd — an important lesson for any industry moving forward.