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How Netflix Is Changing Content Curation

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What is Netflix?

On the surface Netflix seems like an entertainment platform. We use Netflix to stream and order movies. We use Amazon to download and order books. Like Amazon Netflix knows what business they are really in – the information business.

More accurate to say Netflix and Amazon are in the “Infinite information business”. Movies and books are proxies being used to mine information about customers. Once Netflix knows someone watches Ken Burns documentaries, likes Pulp Fiction and The Godfather modeling what beer they drink, car they drive and what food coupons are most likely to be redeemed.

Information is the dividing line between web and print catalogs. Both want and use customer information. Print cataloguers believe they are in a present and ship merchandise business. Amazon and Netflix know they are in the information business.

Curation Is Different Too

How information is curated is different too. Print cataloguers and big box retailers view information as a means to a greater end – customer service. Online retailers understand information is the pot of gold at the end of a rainbow of means.

Netflix’s + Roku’s construction of their reviews based inside out curation demonstrates the difference between catalog and big box merchants and their online counterparts. Netflix creates an algorithm capable of spinning and snipping their inventory so it fits like a glove.

Netflix’s curation is “inside out” because, unlike its print and big box retailer cousins, Netflix doesn’t use information in an attempt to sharing increasingly relevant email marketing. Netflix curates merchandise based on their customer’s expressed likes and dislikes. The curation is the product as out lined in this Haiku Deck:

What Business Are We In?

Traditional retailers must feel like deer in the headlights. Blink and their entire world shifts. Online speed and scale matters more than “market share” or other outmoded ideas such as “mind share”. Macy’s may have 99% brand awareness, but if their online environment creates confusion and dissonance with their stores more than an opportunity is missed.

Every retailer who views their online ecosystem like an extension of their catalog or stores is ripe for the taking. Amazon and Netflix have no preconceived notions. Their expectations about customer behavior is, like the web itself, based on what is happening NOW.

Macy’s is a merchant. Wal-Mart is a logistics king. Both are vulnerable to Amazon and Netflix:

Online vs. Web retailers table via ScentTrail Marketing

Netflix doesn’t look as powerful on this chart as they actually are. Netflix doesn’t play well with Google possibly betraying a larger underlying strategy. Netflix looks better when traffic is the issue. US Traffic rank where lower is better proves the point:

Amazon #5
Netflix #25
Wal-Mart #23
Macy’s #80

The moment Netflix wants to be social or play the game by the social rules everyone else is now playing with they will be successful and Amazon and Wal-Mart better watch out.

 

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