The sizzle that a creative brings in a network pitch is, while still impressive, becoming a smaller and smaller factor in a network’s decision to greenlight an idea. The dawn of big data and seemingly irrelevant network KPI’s are shifting the interplay between producer and broadcaster. We can see this play out with two of the biggest buyers of content in the world: Amazon & Netflix.
The Netflix inaugural original House of Cards was not the brilliant idea of a producer coming in to wow the programming team with his/her vision. This idea was an internal initiative informed by the ocean of data flowing through the Netflix servers. They saw that the original House of Cards mini-series performed well on their platform. Further, they discovered there was a compelling venn diagram that connected the series to viewer predilection for David Fincher and Kevin Spacey films.
As it relates to KPI’s, Netflix doesn’t care about ratings (as they’re contemplated in TV) and doesn’t care about advertisers. They care about subscriber acquisition and minimizing subscriber churn. Further, in the days of the content firehose, Netflix has pulled back on expanding their catalog in favor of optimizing. In a world where scale has become a commodity this move will become more common as it creates value for viewers and advertisers – quality not quantity. This is a benchmark of Ripple’s approach to our networks.
Looking at Amazon, things get even weirder. Here you have a company whose core business is commerce. Despite being a multi-billion dollar buyer of content, video is essentially a loss leader for their primary consumer value proposition – 2 day shipping (aka PRIME). Add the data layer on top of that and you start to get an even more dramatic shift from the traditional producer/network workflow.
So, what does this all mean? Is it the end of creativity? The answer is no, but it is a bold omen for those producing content who are not looking at data and developing a distinct point of view in how they approach and validate their creative business. Creativity is still a defensible skill-set, but in the network world, it will be framed more by execution on an ask vs origination. In this sense, producers will enter into a more traditional RFP process where networks like Amazon and Netflix are telling them what they need (much more evolved and specific than a broadcaster and nielsen trends, focus groups or seeing what works on a competitor). Those who can bring these asks to life in an original, creative execution will prosper.