Netflix, Behavioral Science, and Personalization
Netflix continues to grow from strength to strength, commanding 270 million subscribers who watched 183 billion hours of content last year.
Netflix executives “…believe there’s a better way to make decisions about how to improve the experience we deliver to our members: we use A/B tests…Instead of small groups of executives or experts contributing to a decision, experimentation gives all our members the opportunity to vote, with their actions...”
This gives an insight into Netflix’s awareness of the perils of groupthink and a raft of other biases that can beset boardroom decision making. Netflix notes the weight of charisma in such decision-making processes, rather than scientific evidential backing, evoking Weber’s concept of charismatic authority. True to a behavioral mindset, this approach places empirical evidence over cognitive assessment, or charisma-infused persuasion.
Netflix is amongst a host of other successful organizations carrying out thousands of experiments to refine their offerings, including Google and Amazon. Organizations have recognized the need to evaluate with scientific experimentation; this conclusion is a founding principle of behavioral science. Latent within these corporations is a distinct consumer focus. This might reflect some of the parallels between the fields behavioral science (which emerged from the work of those such as Daniel Kahneman), and behavioral psychology (which emerged at the beginning of the 20th century, through the work of those such as John Watson and B.F. Skinner). Psychologist and historian of psychology Dr. Brian Hughes roots the emergence of behaviorism in the socio-political upheavals of the time, as well as the emerging demand to persuade masses of people, and shape their consumptive behaviors. Organizations like Netflix have been able to excel in a way that the old behavioralists could not because of the scale and volume at which they can conduct scientific testing, enabled by advances in technology.
Netflix regularly employ a number of testing routes, including A/B testing. More intriguingly, they also rely on Contextual Banditry; this form of experimentation relies on using data that is known to make a live decision about which intervention will best work for which customer. Netflix has also detailed its effective use of quasi-experimentation when other routes are not available or are unsuitable.
Beyond this commitment to scientific testing, Netflix has integrated knowledge of a raft of cognitive biases to their offering:
1. Salient Reassurance. Netflix has obviously........
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