|Introduction to Business Analytics
In week 4 we learnt how companies all across the globe are reshaping their industries and business models by implementing big data and data-analytics strategies.
Netflix is an international service company which provides subscription service streaming movies and television over the internet.
Netflix is considered one of the most successful pioneers in pursuing a data-driven strategy by implementing data science and data analytics systems.
Write a report by answering the following questions. In order to write the report you should conduct your own research and watch the videos below:
Netflix Research: Analytics Netflix Research: Machine Learning Netflix Research: Recommendations Netflix Data Driven Animated Gif Campaign
PART 1: Do some research and: [ 2+ 2 +2 marks]
PART 2: Do some research and: [ 3+ 2 + 3 marks]
PART 3: Do some research and: [ 2 +2 +3 marks]
PART 4: Watch the videos and answer the questions below: [ 2+ 1 + 1 + 2 marks]
PART 5: Research, structure and presentation: [ 3 marks ]
As of 2020, the global video streaming or online streaming market was valued in excess of US$50 billion with an extremely high anticipated compounded annual growth rate of almost 21% for the period of next 8-10 years. New innovations such as blockchain technology and AI are expected to further boost the growth. AI already has widespread use in order to provide better quality content to the viewers. The use of cloud-based technologies also has a positive impact on the growth. Apart from streaming television, online games and education services also form important segments of the market. Particularly, the growth has been rampant in the COVID-19 era.
Particularly, the major rivals in the market include YouTube, Netflix etc. Continuously, new players are entering the market such as Google with Yeti game streaming services, Apple Inc. for online video cascading industry, Amazon’s Fire TV etc. (Grand View Research, 2021).
The major barrier to entry to the market is content creation or acquisition along with the licensing procedures. Another technical barrier is to have appropriate capacity so as to ensure smooth streaming and minimal crashing of the platform due to heavy traffic.
b. Netflix competitive strategy
One of the major competitive advantage for Netflix is having quality content across genres. It is identified as a high-quality entertainment platform as it makes big investments in creating or acquiring good content. It has a large number of original shows. Another big advantage is its simple and easy to navigate platform that works as efficiently and smoothly across variety of devices, be it television, laptop, mobile or a tablet. Hence, the user experience is highly positive (Bylund, 2018).
The key strategy is to provide positive user experience in terms of content as well as simplicity.
c. Purpose of implementing big data analytics
Data analytics simply means analysing available data. However, the important thing is to analyse the given data to reach the stated goal in most efficient manner. Hence, for example, for a streaming company one of the important uses of data analytics will be to provide relevant content according to a user’s tastes and preferences so as to provide a good user experience. Hence, it may involve multiple parameters such as user watching history, demographics, age etc.
Hence, the main purpose of big data analytics is to provide better experience to the users with respect to accuracy, reliability, convenience etc.
d. Data-driven company’s characteristics
A data-driven company, such as Netflix, is a company that knows the importance of data and uses data analytics techniques in order to provide better products and services. Data forms the foundation of all the business decisions so as to get better operational and financial efficiency. The main characteristics of such companies are (Peregud, 2018):
e. Business intelligence and data analytics
The terms are very similar but while business intelligence refers to use of techniques and analyzed data so as to take business decisions and form strategies, data analytics refers to the analysis of data so as to achieve a set goal. While business intelligence focuses on past and present, data analytics focuses on the future (Durcevic, 2018).
The big data analytics implementation must lead to predictive analysis through gathered data, lower the costs and save time by weeding out irrelevant data and help in bettering the user experience.
g. Structured and unstructured data
As the name suggests, structured data is a data that can be processed, stored or retrieved in a particular format. Hence, the data is highly organized, for example employee details. The data cannot be changed easily as the structure is set.
Unstructured data refers to the data that lacks a particular format or structure and may vary from point to point. For example, emails. It is difficult to navigate the data and analyze so as to achieve output.
Netflix is more likely to collect unstructured data such as videos, audios, emails, text files etc.
h. Benefits of a cloud-based application
Typically, a cloud-based application is:
i. Main obstacles/challenges
The main challenges for ‘big data analytics’ include (Sharma, 2020):
Netflix was launched in France but was challenging due to sceptical public. They used a ‘Data Driven GIF Campaign’ in order to connect with the French people’s daily problems and solutions. They were able to get into French minds and crack the market with increased user base and high brand awareness.
k. Types of data in the “Data Driven Gif Campaign”
Topics model which is natural language processing system that helps to identify insights that can be converted to business opportunities. The irrelevant data referred to as the surface and noise was removed so as to get the insights.
l. The most important feature
The recommendation system that puts out the recommendations lines for user is very important as 80% of the content watched is from these recommendations. It is based on A/B testing method used by the company. Hence, it is a very big lever for Netflix.
m. Personal information from its users
The personal information of the user collected by Netflix is far more intense and deep as compared to information gathered by other marketing techniques. Hence, the profiles created are very detailed on the basis of various data points, including customer interactions and response to a TV show.