Netflix Knows When You’re Hooked

Oh man, you guys. This is wonderful. Netflix has released the results of a study it did of when people get hooked on TV shows. They defined the “hooked episode” as the episode after which 70% of viewers went on to complete the first season of that show.

The big news from the study (which isn’t really all that surprising, intuitively):

“In our research of more than 20 shows across 16 markets, we found that no one was ever hooked on the pilot. This gives us confidence that giving our members all episodes at once is more aligned with how fans are made.” –Ted Sarandos (emphasis mine)

So, why does this matter?

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The Economics of Suspense

Fascinated by this New York Times article by Jeffrey Ely (Northwestern), Alexander Frankel and Emir Kamenica (Chicago Booth) about using economic theory to optimize entertainment:

“Once these concepts are formalized in this way, the question of how to maximize entertainment — that is, how to generate the most suspense or the most surprise — becomes a mathematical problem.”

Some lessons:

  • Information revealed over time generates drama through suspense (experienced before the fact) and surprise (experienced after the fact).
  • To be thrilling, you must occasionally be boring.
  • Mystery novels should have no more than three major plot twists on average, but the exact number of plot twists should be unpredictable.
  • Five- or seven- series games are optimal in sports, because it allows uncertainty about the eventual winner and allows for large swings in the likely outcome with each passing game.

“Academic analysis of the determinants of entertainment is in its infancy. Future work […] should help us better understand why we are moved by certain sports, novels and games. This might help us design better entertainment. More important, it will lead us to better understand the human psyche.”

I would love to read about these professors’ takes on how the results of their research can pair most effectively with experienced entertainment professionals’ intuition, but I guess that’s a question for another day!

Image courtesy of CBS Broadcasting, Inc.

Poets and Quants: The Case Against the GMAT

Poets and Quants just posted a write-up of a study from Toronto’s Rotman School of Management concerning the GMAT and whether it’s a good predictor of employability post-MBA.

Questioning the GMAT’s ability to predict success outside of the classroom is nothing new. According to the GMAC, the GMAT predicts academic success in an MBA program, which is ostensibly why it’s so important to b schools. (The fact that it has a 16% weight on the US News and World rankings probably doesn’t hurt either.)

But Rotman got all up in the data and found that the GMAT was not a significant predictor of employability post-MBA — here are the factors that they found to be “the five most significant warning signs that an applicant is most likely to be an employment risk, in order of importance:”

  • Citizenship from a region of the world for which Frey declines to identify.
  • Years of work experience. (Ten or more years, to be precise.)
  • Admissions interview scores for candidates.
  • Analytical Writing Assessment (AWA) test. (The GMAT essay section.)
  • Undergraduate grade point average. (Regardless of major.)
  • Then, finally, came an applicant’s GMAT score—barely.

So it seems that communication skills are key to success post-MBA, judging by the importance of performance in the admissions interview and the AWA. Rotman is now using employability risk data to build its class, but keep in mind that these factors don’t predict success in MBA admissions and that they are not universally recognized and utilized.

This is more an interesting way to assess yourself against some proven factors of success and a way to remind yourself that you are more than your GMAT score!

Read more at Poets and Quants.

Image courtesy of Columbia Pictures.

Ted Sarandos: Data, Judgment, Curation

“It is important to know which data to ignore […] In practice, it’s probably a seventy-thirty mix. Seventy is the data, and thirty is judgment, but the thirty needs to be on top, if that makes sense.”

– Ted Sarandos (Chief Content Officer, Netflix)

As someone interested in the data-driven side of entertainment, I love hearing things like this. Yes, data is important — invaluable, really — to discover out what our audiences want to watch and how. But as important is judgment, or taste. So even in data-driven entertainment firms, it’s important to recruit leaders with a well-developed creative sense, as well as a mastery of analytics.

As Tim Wu puts it in his The New Yorker article about Sarandos:

“Perhaps what we are seeing here is better explained by the rise of a different kind of talent. It is a form of curation (at which Sarandos excels) whose aim is guessing not simply what will attract viewers but what will attract fans—people who will get excited enough to spread the word. Data may help, but what may matter more is a sense of what appeals to the hearts of obsessive people, and who can deliver that.”

Image courtesy of IndieWire.