One of the biggest drivers of the converged network is “big data,” as enterprises capture massive amounts of data from every customer interaction and analyze it to predict future sales. One company managing this data really well today is Netflix.
I originally registered for Netflix streaming for research purposes. I have spent a lot of my career developing algorithms to capture the relationship between countless variables that drive business productivity.
My interest in Netflix was its algorithm’s ability to predict what a person would want to watch next. I can only say that the experience was eye-opening. I would have never been exposed to most of what I have watched in the last year without the algorithm — and I know that the mechanism wasn’t just looking at my own ratings of television shows and movies to determine what I liked to watch. At best, my ratings served as a seed for the algorithm.
GigaOm’s Derrick Harris says that Netflix analyzes a lot of data about your viewing habits. He mentions that 75 percent of Netflix users select movies based on the company’s recommendations. To accomplish this, Harris says that Netflix tracks such details as users rewinding, fast forwarding and pausing content. It also tracks ratings, searches, geo-location data, device information, and time of day and week (it now can verify that users watch more TV shows during the week and more movies during the weekend). Layer in tracking of social media data from Facebook and Twitter and you have a pretty robust algorithm.
If your enterprise isn’t purely digital, it may not seem obvious how you can use “big data” in your company to better predict consumer wants and needs. But the best companies do it and do it well. In February, The New York Times’ Charles Duhigg wrote a 6,000-word piece highlighting how Target uses massive amounts of data to predict what individual customers will want to buy. A Forbes blogger summed up the piece with a post entitled “How Target Figured Out a Teen Girl Was Pregnant Before Her Father Did.” No matter what industry you are in, exploiting massive amounts of data across a converged infrastructure will be key to your success.