Media Industry Embracing Analytics for Innovation and Competitive Edge
Survey results highlight the importance of Analytics capability in media industry and the consumer beliefs on privacy vs. personalization benefits.
Bain recently released a report stating that the firms who are leading in Analytics are twice as likely to be in the top quartile of financial performance within their industries and five times as likely to make decisions much faster than their market peers. Thus, it is clear that he importance of Analytics is no more limited to just a few units within media companies, rather it can be seen to have an increasing impact across the organization.
In media, value comes from understanding and predicting the content audiences want. Data and analytics firepower can increase a media company's odds of getting it right.Several media firms are using Analytics to score a strategic advantage over their competition by making the right choices on high-impact business decisions. Empowered by great consumer insights through the media consumption patterns on its website, Netflix confidently made a bold bid to the producers of House of Cards. The show was a big hit and won three Emmy awards. The Weather Company (previously The Weather Channel) is using its data to create a new product (additional revenue stream). It will be selling its weather data and insights to other media companies as well as energy farms and insurance companies.
A successful Analytics strategy will need to focus on three areas:
- Ambition. Leading companies clearly define their intention and describe how improving their analytics capabilities will improve their business performance. Appointing a chief data officer is a strong sign that a company wants to do more than simply organize its analytics efforts; it wants to find new value using them. Yahoo’s appointment of Usama Fayyad is one such example.
- Capabilities. With ambition defined, media executives need to create the will and the skill to use data throughout the organization. Organizations don’t change easily, and the value of analytics may not be apparent to everyone. Leaders define clear owners of analytics initiatives. They provide incentives to ensure decisions are based on data. They create targets for operational or financial improvements and trace the impact of analytics when those targets are achieved.
- Organizational home. Models vary from having centers of excellence to hosting the analytics function in the most relevant parts of the company. But rarely, if ever, do we see analytics capabilities delegated to the IT department. Because it’s so critical to a business’s success, leading companies seat the analytics function closer to their business leaders.
The media consumption habits are rapidly changing and media companies will have to keep up with it through real-time actionable consumer insights. At the same time, companies need to be vary of consumer beliefs on privacy and on how much data consumers are willing to share to get a personalized experience. Finally, media companies can no longer afford to ignore or understate the importance of Analytics to their business. The disruptive changes in content generation, distribution and consumption due to the increasing popularity of social media and decreasing prices of technological solutions have created great opportunities as well as challenges. Leveraging Analytics strategically will play a vital role towards achieving competitive advantage through innovation.
The complete report is available at: Why everyone in media needs an analytics upgrade?