NetFlix Offers $1MM for Better Movie Predictions

Posted: under Niche Marketing Expert Gallery.
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If you have used NetFlix, the DVD rental service, you’ve probably used their recommendation service. They’re success rate in pleasing customers is about to get much better.

Scene from "Makin A Living", Charlie Chaplin's first movie (1914)

Scene from "Makin A Living", Charlie Chaplin's first movie (1914)

The niche market of movie buffs is an eclectic lot. While the rental stores are forced to categorize their physical inventories by such choices as drama, comedy, or action, your individual preferences might be much more varied. Maybe you like Kate Winslet movies. Or you like movies shot in exotic locations. Whatever. NetFlix is spending one million dollars to make you happy. Or, at least, 10% happier. Why? Improved loyalty, more subscribers, more cash.

To accomplish that goal, NetFlix has been running a contest, asking for outsiders to help them improve on the accuracy of predications by 10 percent when compared to their proprietary Cinematch software (originally launched in 2000). After 42,000 contest entries, a team called BellKor’s Pragmatic Chaos has apparently met the goal and is prepared to claim the $1MM prize.

When you engage in marketing to a niche audience, you always have to be wondering how good is good enough. In a retail store, broad categories might be enough to satisfy customer expectations. NetFlix realizes their customers expect more, and are willing to spend 7 figures to raise the bar and hopefully gain a competitive advantage. They understand they serve practically infinite variations of customers, and doing that better than anyone else is how they defend their niche and make their money.

Comments (0) Jul 10 2009

The Murky Market for the Mentally Ill

Posted: under Niche Marketing Expert Gallery.
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The fact is that there are huge niche markets comprised of people with personality disorders. In the U.S.:

Sadly, there are plenty of companies to prey on their “needs.”

For example, do a search for spy software and you’ll find companies that cater to the sociopaths and the paranoid. If someone has a “feeling” their spouse is cheating, they can secretly install software that monitors their spouse’s email and tracks their computer usage. Better yet, if the “wronged” spouse can get to their partner’s cell phone, they can load an application on it that lets them secretly hear every call the suspected cheater gets or makes.

While the term sociopath may not be a medical term, it’s commonly accepted as a label for those who lack a sense of moral responsibility and social conscience. They repeatedly lie, cheat and manipulate others to control them and get what they want regardless of the damage done. Buying spy software does not require them to suspend feelings of guilt or wrongdoing; there was none to begin with.

According the Webster’s Dictionary, the word Exploit has 2 meanings. The first is benevolent: to use fully or advantageously. The second is harmful: to use selfishly or unethically. The folks who prey on niche markets made up of the ill and the weak apply the second definition of Exploit in the most negative and hurtful way.

When you choose a niche market, make sure all your plans to use opportunities fully and advantageously are not marred by selfishness and unethical behavior.

Comments (1) Jun 19 2009