Role of Analytics in Making Better Content Decisions - Whitepaper

1. Media and Entertainment WHITEPAPER Role of Analytics in Making Better Content Decisions

2. Role of Analytics in Making Better Content Decisions Introduction Traditionally, the Customer is King phrase referred to good customer service, but it has evolved to mean much more. Today, customers want to be presented with the best offering. As a result, businesses should be aware of their power and influence across online and social media platforms, about how they dictate the terms and standards to businesses, how things can be made easier and simpler for them, and ways in which they can participate in the journey and development of the final product. Therefore, in today’s digital era, customers hold all the power in business. Analytics allows businesses to make sound decisions related to a product based on better planning, data insights, and customers’ behavioral patterns. In the context of the media and entertainment industry, data analytics is used to track viewers’ leanings and habits to predict successful content, and to understand how audiences consume content. Media companies gather this data by tracking social media conversations, through website and customer surveys. Additionally, analytics is used to shield against piracy, target advertising, and control contracts and rights. Introduction traffic analysis Role of Analytics in the Media and Entertainment Industry Organizations that develop strategic visions around social media chatter, streaming video on demand services, and gaming content will stand to gain today and in the future. According to a McKinsey report, streaming will be very different for consumers by 2030. • The relationship between analytics and creativity will continue to grow, leading to richer content while meeting the interests of niche audiences. For instance, teen movies directed by the likes of John Hughes, Tim Hunter, Lisa Gottlieb, and Wes Craven were extremely popular once. Later, teen TV shows like Gilmore Girls, Glee, and others were trending. However, soon after, teen movies were not even made for that audience. The US streaming service provider Netflix identified this rift and concluded that parents could use teen movies for kids to juggle between tasks. • Streaming services continue to gain traction and were the most favored option for TV viewing compared to cable and broadcast in December 2022, according to Nielsen Insight. Additionally, originals gained prominence by outperforming acquired content with Netflix’s Stranger Things holding the top spot among all programs and originals in December 2022. Nielsen’s Streaming unwrapped: 2022 was the year of original content further finds that Americans streamed over 19.4 million years of content in 2022, an increase of 27% from 2021. Streaming Services – Content Consumption Patterns • As technologies evolve, there will be one universal marketplace for content in the next decade. As a result, there will be abundant content from across the world, which will be accessible to customers across countries and languages. The trend of purchasing global rights will also continue. For instance, Indian shows have begun infusing global casts to make their stories reach everywhere. • Media companies will increase their focus on an audience network rather than just siloed individuals. These networks or enclaves consist of several clusters, communities, and groups with shared interests and experiences. Data analytics will enable organizations to dig into these subtle and complex structures and identify the otherwise invisible patterns that confirm that a storyteller has an audience. These underlying patterns also reveal new connections and suggest why a story or storyteller could be an audience favorite. 2

3. Role of Analytics in Making Better Content Decisions 10.7% Other Streaming 8.7% Broadcast 24.7% 7.5% Streaming 38.1% 3.4% December 2022 2.7% Total Day Persons 2+ 1.9% Cable 30.9% 1.4% Other 6.3% 1.0% 0.8% Source: Nielsen Table 1: 2022 Top 15 Streaming Programs (Originals) Table 2: 2022 Top 15 Streaming Programs (Overall) Mins viewed (Billions) Mins viewed (Billions) Program Name Originator Episodes Program Name Originator Episodes 1 Stranger Things Netflix 34 52.0 1 Stranger Things Netflix 34 52.0 2 Ozark Netflix 44 31.3 2 Ncis Various 356 38.1 3 Wednesday Netflix 8 18.6 3 Cocomelon Netflix 18 37.8 4 Cobra KAI Netflix 50 16.7 4 Ozark Netflix 44 31.3 5 Bridgerton Netflix 16 14.0 5 Encanto Disney+ 1 27.4 6 Virgin River Netflix 42 13.6 6 Greys Anatomy Netflix 396 26.8 7 Dahmer Netflix 10 13.4 7 Criminal Minds Various 328 24.9 8 Love is Blind Netflix 40 13.1 8 Bluey Disney+ 114 21.1 9 Inventing Anna Netflix 9 12.9 9 Gilmore Girls Netflix 153 20.8 10 The Crown Netflix 50 12.7 10 Seinfeld Netflix 176 19.3 11 The Boys Prime Video 24 10.6 11 Supernatural Netfilx 328 18.8 Great British Banking Show 12 Wendesday Netflix 8 18.6 12 Netflix 85 10.6 13 Heartland Netflix 225 18.0 13 The Umbrella Academy Netflix 30 10.5 14 Cobra Kai Netflix 50 16.7 14 The Last Kingdom Netflix 46 10.4 15 The Simpsons Source: Nielsen Disney+ 667 15.9 15 The Rings of Power Source: Nielsen Prime Video 8 9.4 Representative content has a direct effect on viewership. Relatable content or stories are powerful because they increase audience engagement, a key element of an ever- changing industry that offers diverse content choices. According to a Nielsen study, about 53% stated that they preferred to watch inclusive content. The study also found that among the 326 highly bingeable content from the total of more than 973 streaming titles, 232 (over 71%) were inclusive of one or more racial groups. Another insight from the same study highlights that customers do not know what they want to watch when they start looking for programs on a streaming service. Irrelevant content options and the growth in the volume of programs and platforms impact the time viewers spend on searching rather than watching. This results in their switching to other services to find their choice of content. 3

4. Role of Analytics in Making Better Content Decisions Figure 2: Average Number of Minutes to Make a Streaming Selection Among adults 18+ 52% increase From March 2019 Time spent in October 2022 % increase since March 2019 Audience age 18 - 32 12:39 32% 11:16 35 - 49 12:40 51% 7:24 50 - 64 9:00 84% 65+ 8:24 68% March 2019 October 2022 Source: Nielsen Some programs like Game of Thrones, Desperate Housewives, and Grey’s Anatomy were based on appointment viewing – same time, same day, every week model. However, Netflix changed the paradigm by introducing its original series House of Cards in 2013, leading to the concept of binge watching against the weekly drip feeding. However, despite the instant fulfillment and control, the binge trend is losing its appeal due to the lack of anticipation and time-to-process feeling, which viewers would want to savor in a week. As a result, the shift from traditional appointment viewing to binge viewing has not been as successful as expected or long-lived as streamers like HBO Max, Disney+, and Netflix now push to return to weekly releases. Meanwhile, a mix of both models seems ideal for exercising flexibility with content planning and execution. The binge-watching model, characterized by the ability to watch multiple episodes all at once, gained prominence between 2015 and 2020. Additionally, the current level of such viewing patterns is expected to be higher than just before the pandemic lockdowns that witnessed varied types of viewing. Interestingly, this trend has also led to a shift from personal screens to living room watching, while the definition of what people do while watching, and why and when they watch shows has also significantly changed. For instance, surveys suggest that many Netflix viewers watch shows just for background noise, and others for company or as a part of their sleep routines. Social Media Chatter – Identifying Customers’ Content Preferences Social media chatter enables brands to understand their audiences better and improve their brand messaging impact by tracking various metrics like hashtags, brand mentions, and keywords. It also includes concepts like social media monitoring and listening to understand a brand’s performance in comparison to its competitors, while ensuring when and how a piece of content can make the cut. Social media analytics helps media and entertainment businesses in: • Identifying trends in terms of reach, impressions, and customer sentiment, • Comprehending conversations feedback from audience comments, • Analyzing customer sentiment (tone and intent) and how it evolves, • Evaluating responses and feedback around the content and tech to ensure that both content and content delivery are in check, • Identifying positives and negatives from a trailer, teaser, and show and likewise through audience chatter, reactions, and reach, • Investigating competitors’ views, and • Understanding ways in which third-party partners and networks can impact performance. and extracting 4

5. Role of Analytics in Making Better Content Decisions KPIs Used to Measure Content Performance – Streaming and Broadcast Streaming services use various key performance indicators (KPIs) to evaluate overall performance. These KPIs include time spent on the platform, engagement rate, retention rate, user lifetime value, churn rate, ad engagement rate, net promoter score (NPS), and other metrics. Additionally, content or video consumption on streaming and broadcast programs is gaged based on the following characteristics: • Bingeability: To deduce how many episodes audiences watch on their TVs daily to calculate viewers’ tendency to watch several episodes on a non-stop basis. • Loyalty: To understand how much of available content is watched every month, in minutes (time) and percentage, to detect viewers’ stickiness with a show. • Show Similarity: To identify shows that resemble other shows based on the theme, historical performance, and audiences. • Content Stickiness: To understand the amount of time spent on diverse types of content, the stickiness of the audience on a particular content episode over episode for a series, and the percentage of content length viewed for a trailer, teaser, and movie. • Reactions on the Content: To analyze the type of audience reactions on newly launched shows, promos, movies, trailers, and teasers. • Percentage of Positive engagement is a powerful metric, it is important to view positive engagement to ensure that audiences are receiving the content well. Contrarily, the content should not gain engagement for the wrong reasons, controversies, or inferior quality. Engagement: While Table 3: A Look at Loyalty and Binge Scores: Inventing Anna and the Lincoln Lawyer Inventing Anna The Lincoln Lawyer Debut date Feb. 11, 2022 May 13, 2022 Platform Netflix Netflix Episodes 9 10 Loyalty score 0.34 0.78 Binge score 2.1 3.5 Source: Nielsen The above comparison by Nielsen, for example, finds that viewers were more hooked on The Lincoln Lawyer (May 2022) than Inventing Anna (February 2022). While Netflix has plans to release Season 2 of the former show, the latter was a limited series. However, Netflix and its creators could introduce a second season for Inventing Anna as well, given the traction of its loyalty and binge scores. 5

6. Role of Analytics in Making Better Content Decisions Gaming will be embodied across the media and entertainment sector Gaming will play a critical role across the media and entertainment sector in 2023 and beyond. It will also highlight communities and fandoms in expanding entertainment licenses. According to PwC’s Global Entertainment & Media Outlook 2022–2026, social and casual gaming is driving a boom in the media and entertainment industry. Figure 3: Total Global Video Games Revenue, by Segment (US$bn) PC games Console games Integrated video games advertising Social/casual gaming 321.1 299.9 31.5 278.4 31.1 257.1 42.2 30.6 235.7 40.4 30.0 214.2 38.6 196.9 29.2 36.9 28.3 35.2 162.4 28.6 33.7 139.2 242.7 31.3 25.6 223.8 120.4 204.7 25.0 28.9 185.8 23.8 27.3 167.0 148.0 25.5 132.9 103.9 83.2 67.7 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 Note: 2021 is the latest available data, 2022-2026 value are forecasts. Source: PwC’s Global Entertainment & Media Outlook 2022-2026, Omdia Gaming offers social, multi-player experiences, while directly monetizing content developments. As it paves its way to the metaverse, new digital advertising, and brand and entertainment interests, it is expected to compete directly with streaming video. More subscription video on demand (SVOD) companies, as a result, will prioritize gaming through procurements or IP deals. They will also leverage content creators and social media to create viral trends and increase audience engagement. Conclusion SG Analytics (SGA) is a pioneer in the use of analytics and technology to create valuable, relevant, and reliable insights. The company has enabled its clients to gather audience intelligence around their and their competitors’ services to make better marketing strategies. The company’s weekly streaming app buzz insights report for clients, for example, showcases the voice of customers along with recommendations around marketing and content improvement strategy. This is a call-to-action (CTA) on improving content promotions on social media platforms, gaining awareness about the negative sentiments that may impact their viewership, and understanding the reception of content. 6

7. Role of Analytics in Making Better Content Decisions About the Author PRARTHNA TIGA • Senior Analyst - Product – iNAVA Prarthna Tiga is part of the Business Operations, technology data intelligence team at SG Analytics. She has over 7 years of experience in market research and publishing. Prior to joining SG Analytics, she was part of the technology and media teams at GlobalData. Prarthna holds a Master’s degree in English Literature and a Bachelor’s degree in Commerce. She is keen about charitable services, and is an avid reader, traveller, and sports enthusiast and can be found playing basketball or badminton in her free time. Disclaimer This document makes descriptive reference to trademarks that may be owned by others. The use of such trademarks herein is not an assertion of ownership of such trademarks by SG Analytics (SGA) and is not intended to represent or get commercially benefited from it or imply the existence of an association between SGA and the lawful owners of such trademarks. Information regarding third-party products, services, and organizations was obtained from publicly available sources, and SGA cannot confirm the accuracy or reliability of such sources or information. Its inclusion does not imply an endorsement by or of any third party. Copyright © 2023 SG Analytics Pvt. Ltd. www.sganalytics.com GET IN TOUCH Pune | Hyderabad | Bengaluru | London | Zurich | New York | San Francisco | Toronto | Amsterdam 7