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1 KEEP CHALLENGING March 2014
The Consumer Halo in
Media and Entertainment
2 KEEP CHALLENGING October 2014
JFK
American Airways
Flight G34789
Departing 15:35
LGW
8,449 14Total Airmiles Flights
On time
1mJust about to catch a plane
to London - look out, here I
come!!!!!
instagram.com/yifSx
10m@conniethanks
sweetheart, can’t wait to
see you back home again
“Here,” says Carey Mulligan, alighting excitedly on a page
in a well-thumbed paperback biography of Zelda Fitzger-
ald. “ ‘She had no more worries than a puppy would have,
or a kitten. . . .’That’s Zelda. That’s Daisy.”
We are in a café in Covent Garden, and the 27-year-old
actress is taking me through her research for the role of
Daisy in Baz Luhrmann’s forthcoming adaptation of The
Great Gatsby. Her blonde hair newly grown out, Mulligan
is wearing some battered cowboy boots she bought in
Montana (“I was thrown from an actual horse in them”),
leggings, and a much-loved brown sweater with holes in
the elbows, shrunk with too many washes. Last night, she
stayed with her parents in order to take her mother to a
cooking class as a belated Christmas present; she has just
big table and everyone mucking in, all tasting from the
same pot.” Hence the jumbly, just-pulled-on clothes.
Like • Comment • Share
Julie Evans was tagged in Paul
Barns photo. — with Mark Wright
and 4 others.4 minutes ago
The staff posted “Introducing the marvelously redesigned Vimeo
mobile website”to the blog. The latest Vimeo Video School
lesson is “Challenge: Storytelling the Stillmotion Way”.
Welcome home Lisa
My Feed My Videos Watch Later Discover Activity
Today’s consumers are increasingly interweaving their physical worlds with their virtual
lives (and vice versa). The websites they visit, devices they use, and social networks they
build online all create ‘Code Halos’, or digital profiles about their interests, persona, and
tendencies. This creates massive opportunities for entertainment companies not only
to create tailored entertainment experiences, but also to deliver them more precisely
and efficiently than ever before. In this white paper, Cognizant will share how one studio
is starting to realize the benefits of the consumer halo, by combining data sets and
generating new insights in their CRM program through a pilot analytics project.
Endorsements copy to come
Paul Roehrig leads Cognizant’s Center for the Future of
Work. Prior to joining Cognizant, Paul was a Principal
Analyst at Forrester Research and held a variety of
positions at Hewlett-Packard and Compaq Computer
Corp. Paul has a degree in journalism from the University
of Florida and a doctorate from Syracuse University.
Ben Pring co-leads Cognizant’s Center for the
Future of Work. He joined Cognizant after
spending 15 years with Gartner as a Research Vice
President analyzing enterprise technologies and
the development of Cloud Computing. Ben
graduated with a degree in philosophy from
Manchester University.
Malcolm Frank is Executive Vice President of Strategy
and Marketing at Cognizant, one of the world’s leading
technology, consulting, and business process services
companies with over 175,000 employees. Malcolm has
authored articles in several leading industry publications
in Finance by Treasury & Risk magazine. He earned a B.A.
in economics from Yale University.
Howthedigitallivesofpeople,thingsandorganizations
arechangingtherulesofbusiness.APlaybookForManagers.
THE CONSUMER HALO IN MEDIA AND ENTERTAINMENT 3
Introduction
Big Data. That’s the term we hear so much in today’s consumer economy, describing
the sheer volume of data accessible to companies. Social Media, mobile devices, and
cloud-based storage have propelled big data from an idealistic concept into what we
know today. Year after year, human consumption of
data grows at an ever accelerating rate. In 2009, an IDC
studyestimatedthat800,000petabytes(0.8zetabytes)
of data were generated1
. By 2020, the amount of data
in the digital universe will grow to 35,000 zetabytes, a
figure that was inconceivable to most people a decade
ago.Whileinformationhasbeenaccumulatingforalong
time, the rate of growth has exploded as computers
and digital devices—especially connected devices—have
becomeubiquitous.Where,inthelate90’s/early2000’s
a household might have had one family computer, now
individual family members have a personal
computer, a smart phone, tablet, smart watch, and are even wearing smart
glasses. Today’s consumer is über-connected. News, business, and social
communication are constant, so the portability and “always on” notion of
our devices are deemed a necessity to those consumers. Everything we
touch now has the ability to collect data about us.
As the consumer has been busy trying to keep up with the rapid pace
of media by using more devices, granting access to online profiles, and
linking everything together, he is leaving behind a trail of digital breadcrumbs. We call
this trail a “Code Halo”. The Code Halo has the potential to reveal significant amounts
of useful information about a particular consumer’s
preferences, habits, and inclinations. Code Halos help
avoid misdirected messaging and poorly focused
channels, while optimizing marketing programs and
creating highly specific, highly granular messaging
that hits the target market with precision. Better yet,
when properly implemented, a Code Halos program
will continue to sift through data, find correlations,
gather insights, and strengthen continuously over time.
As assumptions are confirmed or re-evaluated, the
results will become ever smarter and more valuable
to the company.
Think about everything you do with your
mobile phone and tablet nowadays: connect
with friends and colleagues, read books, play
get directions, buy products… and even work.
devices. Now add in all the data being
generated by“things”like cars, televisions,
airplanes, even toothbrushes.
Every click, swipe,“like,”buy, comment,
deposit, jog, and search produces something
we call a Code Halo, a virtual self. Code Halos
are important to us as individuals, and now
they are becoming critical for business
success. In fact, market leadership in more
than a dozen industries has already violently
transitioned because of the impact of Code
Halos.
This book explores the Code Halo
phenomenon and describes how the“digital
lives”of people, things, and organizations are
changing the rules of business.
Download the Code
Halos iPad app
1
http://www.emc.com/collateral/analyst-reports/idc-digital-universe-are-you-ready.pdf
By 2020, the amount
of data in the digital
universe will grow to
35,000 zetabytes,
a figure that was
inconceivable to
most people a
decade ago.
The Code Halo has
the potential to
reveal significant
amounts of useful
information about a
particular consumer’s
preferences, habits,
and inclinations.
Impact on the marketplace
At the Crossroads, complex algorithms are inseparable from the connections found between
people, technology, and organizations2
.
Code Halos utilize a concept called ‘The Crossroads’—a point in time where growth of traditional
industry leaders is challenged, outpaced even, by growth among competitors leveraging data-
driven analytics to their advantage (See Figure 1). This concept is particularly evident
in the media and entertainment industry, where companies like Netflix, Google,
Amazon and Hulu are already differentiating themselves in the filmed entertainment,
broadcast, publishing, and information services segments.
Netflix initially gained popularity by bringing movies to the consumer in a more
convenient fashion. However, they have blossomed into an entertainment juggernaut
by being meticulous about metadata, and combining that data with customers’
viewing habits. They invest significantly in continuing to hone an algorithm that
delivers more relevant and personalized programming to their customers3
. Amazon’s
early selling points were similar to Netflix in that their customers could purchase
books and other consumer goods conveniently and inexpensively. However, for
years they have also been tracking and collecting data on their customers, mining
it to drive consumer purchases through compelling recommendations. Furthermore,
they used this competency as leverage in driving contract and pricing negotiations
with publishers and content providers. Google has a well-documented history of
data collection. While this has, from time to time, attracted controversy among
competitors (remember Microsoft’s ‘Scroogled’ campaign?), Google has successfully
grown their email product to hundreds of millions of active users by creating a
personalized experience for their customers. Hulu uses data as a differentiator to
deliver personalized advertising to their customers4
. Despite a smaller (but growing)
user base when compared to the major television networks, Hulu’s ability to collect
data about viewer activity and preferences allows them to target precisely which
viewers will receive which message. In an
interview with the New York Times, Jean-Paul
Colaco, Hulu’s former Senior Vice President for
Advertising5
, said “in the future, I know you’re
more of a diet-conscious person and can send
you more ads for diet drinks.”
The compelling commonality between all
of these examples is that these companies
are relatively young when compared to
their industry rivals. Amazon (’94), Netflix
(’97) and Google (’98) seem like industry
veterans being founded in the 90’s while
Hulu was only just founded in 2007. If
a startup can demonstrate this type of
success with data, one can be optimistic about the opportunities an established, historically
successful company has to do the same—and to win at ‘The Crossroads’. It just doesn’t
happen without thought and planning. In order to be successful, a Code Halos initiative must
be deliberate and methodical, and receive full support from the highest level within the
organization.
2
Code Halos, Frank, Roehrig, Pring, March 28, 2014f
3
http://www.theatlantic.com/technology/archive/2014/01/how-netflix-reverse-engineered-hollywood/282679/
4
http://www.nytimes.com/2012/04/17/business/media/hulu-the-online-tv-site-adds-original-programming.html?pagewanted=all&_r=0
5
Jean-Paul Colaco has since left Hulu, and now works for Vessel
4 KEEP CHALLENGING October 2014
The Crossroads Model: Winning with Code Halos
Ionization Spark Enrichment Crossroads After the Crossroads
Company B
Winning the New
Code Rush
Company A
The Extinction Event
Company A
Focused on Assets
Company B
Focused on Code
Halos
MarketCapitalization
Figure 1
Code Halos utilize a
concept called ‘The
Crossroads’—a point
in time where growth
of traditional industry
leaders is challenged,
outpaced even,
by growth among
competitors leveraging
data-driven analytics
to their advantage.
Case Study: Consumer Insights at a Major Studio
A significant advance in the big data revolution is just how rapidly companies are beginning to adopt aspects of the
Code Halos concept. Over the past 18 months, Cognizant has been actively shaping how its clients manage the influx
of consumer information—including a wide array of new vendors and tools—as well as the challenges of aligning
new and existing business models with consumerized data (See example in Figure 2). A recent project at a major
Hollywood studio tasked Cognizant with providing an in-depth segmentation study of the studio’s digital customer,
including strategic recommendations on segment utilization, visualizations of the psychographic breakout, and
profitable audience engagement tactics. Some key business questions included:
• How are customers consuming content?
• How can we measure engagement across brands, devices, countries, etc.?
• What are the most profitable consumer behaviors?
• How do we drive our audiences in high ROI directions?
• Who are our customers and what do they care about?
Figure 2
Travel Personal
Sports
News & Information
SocialMusic & Video
Shopping & Entertainment
Dan’s Code Halo
PERSONAL
• 32 year old Digital Marketing Manager
• Recently Married
• Adrenaline Junkie
• Loves Movies & Traveling
• One of Six Children
PROFESSIONAL
• MBA from UCLA
• Previously was Financial Auditor of
Media & Entertainment Firms
• Consistent High Performer
GEOGRAPHIC
• Based in LA for past 3 years
• Lived in UK for 2 years
• Originally from Orlando, FL
• Frequently takes beach and
ski vacations
THE CONSUMER HALO IN MEDIA AND ENTERTAINMENT 5
This studio is in the early stages of developing a comprehensive digital fingerprint for its
customers, mining its data warehouse for insights into behaviors and patterns (See Figure 3).
Various customer data points are captured through many different sources, including web traffic,
video playback, e-commerce, CRM response data, sweepstakes and newsletter signups (to name
a few). Individually, each of these sources can tell a story about the studio’s customers. However,
the real value is derived from combining this data together and mapping as much as possible to
individual users. This mapping process is where Code Halos become a reality. When the studio
is able to take a step back and analyze a multitude of reports generated from this layering of
data sources, executives and business units are able to make strategic decisions with increasingly
sophisticated information.
This customer profiling allows the studio to be more targeted with marketing, more focused
with recommendations, and truly understand the interests and preferences of its customers.
The resulting shift in marketing spend should also increase the revenue associated with more
relevant targeted products and smarter up-selling to the customer. The studio will also be able to
improve the customer experience by sending more targeted communication on a cadence that
fits each customer profile. For highly engaged customers, they may get more emails with detailed
messaging for specific campaigns. For less-engaged customers, they may only get occasional sale
messaging for mass campaigns to entice action.
In addition to marketing, Code Halos are giving this studio insight into how much its
customers are worth. Additional work is being done to create a segmentation model
based on predefined business rules around the data the studio currently holds. This
segmentation process will value different activities and data touchpoints as a way to
align customers into relevant groups. These groups will give the business an idea of
who its customers are, how many are associated with different characteristics, and
what their average value to the studio looks like. These values will help the studio
make decisions for marketing and even content creation.
The overall (total) value of each customer can be estimated using statistical and
predictive analysis with all of their known data points. Rather than a simplistic
linear extrapolation, we are mapping data points, activities and patterns into a
predictive model that projects future value more realistically. For example, a new
customer that clicks through on emails at a high rate, subscribes to one of the
studio’s digital products, and attends a convention featuring a studio franchise
Figure 3
BEFORE
AFTER
ANALYZED
DATA
SOURCES
1st Party
2nd Party
3rd Party
Owned Websites,
Apps,
Products,
Data Platforms
ExternalData Appends,
SocialProcured Data
Partners,
Subsidiaries,
Affiliates?
6 KEEP CHALLENGING October 2014
In addition to
marketing, Code Halos
are giving this studio
insight into how much
its customers are
worth.
may have a small actual dollar value in isolation. With our predictive model however, we are
able to contextualize these characteristics and provide a better look at how much this person
will actually be worth to the studio in the long run. Here, a series of discrete data points,
otherwise compartmentalized in unrelated line-of-business silos, have been smartly aligned
to identify high potential consumers for further targeting. The result is greater than the
arithmetic sum of the parts. Code Halos are the magic glue.
Summary
The best part about a Code Halos initiative is that both sides win. The customer
receives a better, more personalized experience with more relevant and interesting
marketing communications. The studio benefits from more efficient, targeted
marketing campaigns that drive opportunities for additional revenue. As obvious as
this may seem, companies often do not know where to get started or how to execute
on a Code Halos type of initiative. In these instances it is best to start small and identify
opportunities for pilot or proof-of-concept programs. While these may not answer all
data questions overnight, they can provide a foundation for a more robust platform
from which data can be extracted, cleansed, and studied. Once the foundation is set,
layers can then be added over time to improve the sophistication and business value.
The bottom line is that Big Data is here to stay. The pipeline of information flowing
from all of our devices isn’t going to slow down any time soon – it’s only going to
grow. Companies are best advised to get in early and and claim their competitive
advantage while industry peers are still trying to hone their strategy around data
and analytics. The timing is right. Code Halo programs are still in their infancy at
most of the major brands in entertainment. They aren’t simple to implement. In fact,
they require significant thought and coordination to truly succeed. However, when
implemented properly, Code Halos can be used to optimize marketing campaigns,
increase profitability (through higher revenue and cost savings), and create better
entertainment experiences for customers. In turn, these new consumer experiences
will create important new revenue streams for those companies able to harness the
power of Code Halos.
Code Halos can be
used to optimize
marketing campaigns,
increase profitability
(through better
revenue and cost
savings), and create
better entertainment
experiences for
customers.
THE CONSUMER HALO IN MEDIA AND ENTERTAINMENT 7
World Headquarters
500 Frank W. Burr Blvd.
Teaneck, NJ 07666 USA
Phone: +1 201 801 0233
Fax: +1 201 801 0243
Toll Free: +1 888 937 3277
inquiry@cognizant.com
European Headquarters
1 Kingdom Street
Paddington Central
London W2 6BD
Phone: +44 (0) 207 297 7600
Fax: +44 (0) 207 121 0102
infouk@cognizant.com
India Operations Headquarters
#5/535, Old Mahabalipuram Road
Okkiyam Pettai, Thoraipakkam
Chennai, 600 096 India
Phone: +91 (0) 44 4209 6000
Fax: +91 (0) 44 4209 6060
inquiryindia@cognizant.com
© Copyright 2015, Cognizant. All rights reserved. No part of this document may be reproduced, stored in a retrieval system,
transmitted in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the express
written permission from Cognizant. The information contained herein is subject to change without notice. All other trademarks
mentioned herein are the property of their respective owners.
About Media & Entertainment
Cognizant’s Media and Entertainment practice provides
information technology, consulting, and business process
outsourcing services for: broadcasting, entertainment
(film, music and gaming), advertising and marketing
and printing and publishing firms. The growth of
digital platforms is causing significant change to these
industries and Cognizant is working with clients to help
meet these challenges while helping transform their
businesses to run better and run different. Leveraging
its deep domain and business consulting expertise,
Cognizant serves all the major entertainment studios
and the top broadcasting companies worldwide. We
continually invest in defining what the future of work
means for our industry by developing solutions through
our Digital Media Lab and working in critical areas such
as the Digital Content Supply Chain and Media Asset
Management. Visit us online at www.cognizant.com/
information-media-entertainment.
About Cognizant
Cognizant (NASDAQ: CTSH) is a leading provider of
information technology, consulting, and business process
outsourcing services, dedicated to helping the world’s
leading companies build stronger businesses.
Headquartered in Teaneck, New Jersey (U.S.), Cognizant
combines a passion for client satisfaction, technology
innovation, deep industry and business process expertise,
and a global, collaborative workforce that embodies the
future of work. With over 100 development and delivery
centers worldwide and approximately 217,700 employees
as of March 31, 2015, Cognizant is a member of the
NASDAQ-100, the S&P 500, the Forbes Global 2000, and
the Fortune 500 and is ranked among the top performing
and fastest growing companies in the world. Visit us online
at www.cognizant.com or follow us on Twitter: @Cognizant.

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The Consumer Halo in Media and Entertainment

  • 1. 1 KEEP CHALLENGING March 2014 The Consumer Halo in Media and Entertainment
  • 2. 2 KEEP CHALLENGING October 2014 JFK American Airways Flight G34789 Departing 15:35 LGW 8,449 14Total Airmiles Flights On time 1mJust about to catch a plane to London - look out, here I come!!!!! instagram.com/yifSx 10m@conniethanks sweetheart, can’t wait to see you back home again “Here,” says Carey Mulligan, alighting excitedly on a page in a well-thumbed paperback biography of Zelda Fitzger- ald. “ ‘She had no more worries than a puppy would have, or a kitten. . . .’That’s Zelda. That’s Daisy.” We are in a café in Covent Garden, and the 27-year-old actress is taking me through her research for the role of Daisy in Baz Luhrmann’s forthcoming adaptation of The Great Gatsby. Her blonde hair newly grown out, Mulligan is wearing some battered cowboy boots she bought in Montana (“I was thrown from an actual horse in them”), leggings, and a much-loved brown sweater with holes in the elbows, shrunk with too many washes. Last night, she stayed with her parents in order to take her mother to a cooking class as a belated Christmas present; she has just big table and everyone mucking in, all tasting from the same pot.” Hence the jumbly, just-pulled-on clothes. Like • Comment • Share Julie Evans was tagged in Paul Barns photo. — with Mark Wright and 4 others.4 minutes ago The staff posted “Introducing the marvelously redesigned Vimeo mobile website”to the blog. The latest Vimeo Video School lesson is “Challenge: Storytelling the Stillmotion Way”. Welcome home Lisa My Feed My Videos Watch Later Discover Activity Today’s consumers are increasingly interweaving their physical worlds with their virtual lives (and vice versa). The websites they visit, devices they use, and social networks they build online all create ‘Code Halos’, or digital profiles about their interests, persona, and tendencies. This creates massive opportunities for entertainment companies not only to create tailored entertainment experiences, but also to deliver them more precisely and efficiently than ever before. In this white paper, Cognizant will share how one studio is starting to realize the benefits of the consumer halo, by combining data sets and generating new insights in their CRM program through a pilot analytics project. Endorsements copy to come Paul Roehrig leads Cognizant’s Center for the Future of Work. Prior to joining Cognizant, Paul was a Principal Analyst at Forrester Research and held a variety of positions at Hewlett-Packard and Compaq Computer Corp. Paul has a degree in journalism from the University of Florida and a doctorate from Syracuse University. Ben Pring co-leads Cognizant’s Center for the Future of Work. He joined Cognizant after spending 15 years with Gartner as a Research Vice President analyzing enterprise technologies and the development of Cloud Computing. Ben graduated with a degree in philosophy from Manchester University. Malcolm Frank is Executive Vice President of Strategy and Marketing at Cognizant, one of the world’s leading technology, consulting, and business process services companies with over 175,000 employees. Malcolm has authored articles in several leading industry publications in Finance by Treasury & Risk magazine. He earned a B.A. in economics from Yale University. Howthedigitallivesofpeople,thingsandorganizations arechangingtherulesofbusiness.APlaybookForManagers.
  • 3. THE CONSUMER HALO IN MEDIA AND ENTERTAINMENT 3 Introduction Big Data. That’s the term we hear so much in today’s consumer economy, describing the sheer volume of data accessible to companies. Social Media, mobile devices, and cloud-based storage have propelled big data from an idealistic concept into what we know today. Year after year, human consumption of data grows at an ever accelerating rate. In 2009, an IDC studyestimatedthat800,000petabytes(0.8zetabytes) of data were generated1 . By 2020, the amount of data in the digital universe will grow to 35,000 zetabytes, a figure that was inconceivable to most people a decade ago.Whileinformationhasbeenaccumulatingforalong time, the rate of growth has exploded as computers and digital devices—especially connected devices—have becomeubiquitous.Where,inthelate90’s/early2000’s a household might have had one family computer, now individual family members have a personal computer, a smart phone, tablet, smart watch, and are even wearing smart glasses. Today’s consumer is über-connected. News, business, and social communication are constant, so the portability and “always on” notion of our devices are deemed a necessity to those consumers. Everything we touch now has the ability to collect data about us. As the consumer has been busy trying to keep up with the rapid pace of media by using more devices, granting access to online profiles, and linking everything together, he is leaving behind a trail of digital breadcrumbs. We call this trail a “Code Halo”. The Code Halo has the potential to reveal significant amounts of useful information about a particular consumer’s preferences, habits, and inclinations. Code Halos help avoid misdirected messaging and poorly focused channels, while optimizing marketing programs and creating highly specific, highly granular messaging that hits the target market with precision. Better yet, when properly implemented, a Code Halos program will continue to sift through data, find correlations, gather insights, and strengthen continuously over time. As assumptions are confirmed or re-evaluated, the results will become ever smarter and more valuable to the company. Think about everything you do with your mobile phone and tablet nowadays: connect with friends and colleagues, read books, play get directions, buy products… and even work. devices. Now add in all the data being generated by“things”like cars, televisions, airplanes, even toothbrushes. Every click, swipe,“like,”buy, comment, deposit, jog, and search produces something we call a Code Halo, a virtual self. Code Halos are important to us as individuals, and now they are becoming critical for business success. In fact, market leadership in more than a dozen industries has already violently transitioned because of the impact of Code Halos. This book explores the Code Halo phenomenon and describes how the“digital lives”of people, things, and organizations are changing the rules of business. Download the Code Halos iPad app 1 http://www.emc.com/collateral/analyst-reports/idc-digital-universe-are-you-ready.pdf By 2020, the amount of data in the digital universe will grow to 35,000 zetabytes, a figure that was inconceivable to most people a decade ago. The Code Halo has the potential to reveal significant amounts of useful information about a particular consumer’s preferences, habits, and inclinations.
  • 4. Impact on the marketplace At the Crossroads, complex algorithms are inseparable from the connections found between people, technology, and organizations2 . Code Halos utilize a concept called ‘The Crossroads’—a point in time where growth of traditional industry leaders is challenged, outpaced even, by growth among competitors leveraging data- driven analytics to their advantage (See Figure 1). This concept is particularly evident in the media and entertainment industry, where companies like Netflix, Google, Amazon and Hulu are already differentiating themselves in the filmed entertainment, broadcast, publishing, and information services segments. Netflix initially gained popularity by bringing movies to the consumer in a more convenient fashion. However, they have blossomed into an entertainment juggernaut by being meticulous about metadata, and combining that data with customers’ viewing habits. They invest significantly in continuing to hone an algorithm that delivers more relevant and personalized programming to their customers3 . Amazon’s early selling points were similar to Netflix in that their customers could purchase books and other consumer goods conveniently and inexpensively. However, for years they have also been tracking and collecting data on their customers, mining it to drive consumer purchases through compelling recommendations. Furthermore, they used this competency as leverage in driving contract and pricing negotiations with publishers and content providers. Google has a well-documented history of data collection. While this has, from time to time, attracted controversy among competitors (remember Microsoft’s ‘Scroogled’ campaign?), Google has successfully grown their email product to hundreds of millions of active users by creating a personalized experience for their customers. Hulu uses data as a differentiator to deliver personalized advertising to their customers4 . Despite a smaller (but growing) user base when compared to the major television networks, Hulu’s ability to collect data about viewer activity and preferences allows them to target precisely which viewers will receive which message. In an interview with the New York Times, Jean-Paul Colaco, Hulu’s former Senior Vice President for Advertising5 , said “in the future, I know you’re more of a diet-conscious person and can send you more ads for diet drinks.” The compelling commonality between all of these examples is that these companies are relatively young when compared to their industry rivals. Amazon (’94), Netflix (’97) and Google (’98) seem like industry veterans being founded in the 90’s while Hulu was only just founded in 2007. If a startup can demonstrate this type of success with data, one can be optimistic about the opportunities an established, historically successful company has to do the same—and to win at ‘The Crossroads’. It just doesn’t happen without thought and planning. In order to be successful, a Code Halos initiative must be deliberate and methodical, and receive full support from the highest level within the organization. 2 Code Halos, Frank, Roehrig, Pring, March 28, 2014f 3 http://www.theatlantic.com/technology/archive/2014/01/how-netflix-reverse-engineered-hollywood/282679/ 4 http://www.nytimes.com/2012/04/17/business/media/hulu-the-online-tv-site-adds-original-programming.html?pagewanted=all&_r=0 5 Jean-Paul Colaco has since left Hulu, and now works for Vessel 4 KEEP CHALLENGING October 2014 The Crossroads Model: Winning with Code Halos Ionization Spark Enrichment Crossroads After the Crossroads Company B Winning the New Code Rush Company A The Extinction Event Company A Focused on Assets Company B Focused on Code Halos MarketCapitalization Figure 1 Code Halos utilize a concept called ‘The Crossroads’—a point in time where growth of traditional industry leaders is challenged, outpaced even, by growth among competitors leveraging data-driven analytics to their advantage.
  • 5. Case Study: Consumer Insights at a Major Studio A significant advance in the big data revolution is just how rapidly companies are beginning to adopt aspects of the Code Halos concept. Over the past 18 months, Cognizant has been actively shaping how its clients manage the influx of consumer information—including a wide array of new vendors and tools—as well as the challenges of aligning new and existing business models with consumerized data (See example in Figure 2). A recent project at a major Hollywood studio tasked Cognizant with providing an in-depth segmentation study of the studio’s digital customer, including strategic recommendations on segment utilization, visualizations of the psychographic breakout, and profitable audience engagement tactics. Some key business questions included: • How are customers consuming content? • How can we measure engagement across brands, devices, countries, etc.? • What are the most profitable consumer behaviors? • How do we drive our audiences in high ROI directions? • Who are our customers and what do they care about? Figure 2 Travel Personal Sports News & Information SocialMusic & Video Shopping & Entertainment Dan’s Code Halo PERSONAL • 32 year old Digital Marketing Manager • Recently Married • Adrenaline Junkie • Loves Movies & Traveling • One of Six Children PROFESSIONAL • MBA from UCLA • Previously was Financial Auditor of Media & Entertainment Firms • Consistent High Performer GEOGRAPHIC • Based in LA for past 3 years • Lived in UK for 2 years • Originally from Orlando, FL • Frequently takes beach and ski vacations THE CONSUMER HALO IN MEDIA AND ENTERTAINMENT 5
  • 6. This studio is in the early stages of developing a comprehensive digital fingerprint for its customers, mining its data warehouse for insights into behaviors and patterns (See Figure 3). Various customer data points are captured through many different sources, including web traffic, video playback, e-commerce, CRM response data, sweepstakes and newsletter signups (to name a few). Individually, each of these sources can tell a story about the studio’s customers. However, the real value is derived from combining this data together and mapping as much as possible to individual users. This mapping process is where Code Halos become a reality. When the studio is able to take a step back and analyze a multitude of reports generated from this layering of data sources, executives and business units are able to make strategic decisions with increasingly sophisticated information. This customer profiling allows the studio to be more targeted with marketing, more focused with recommendations, and truly understand the interests and preferences of its customers. The resulting shift in marketing spend should also increase the revenue associated with more relevant targeted products and smarter up-selling to the customer. The studio will also be able to improve the customer experience by sending more targeted communication on a cadence that fits each customer profile. For highly engaged customers, they may get more emails with detailed messaging for specific campaigns. For less-engaged customers, they may only get occasional sale messaging for mass campaigns to entice action. In addition to marketing, Code Halos are giving this studio insight into how much its customers are worth. Additional work is being done to create a segmentation model based on predefined business rules around the data the studio currently holds. This segmentation process will value different activities and data touchpoints as a way to align customers into relevant groups. These groups will give the business an idea of who its customers are, how many are associated with different characteristics, and what their average value to the studio looks like. These values will help the studio make decisions for marketing and even content creation. The overall (total) value of each customer can be estimated using statistical and predictive analysis with all of their known data points. Rather than a simplistic linear extrapolation, we are mapping data points, activities and patterns into a predictive model that projects future value more realistically. For example, a new customer that clicks through on emails at a high rate, subscribes to one of the studio’s digital products, and attends a convention featuring a studio franchise Figure 3 BEFORE AFTER ANALYZED DATA SOURCES 1st Party 2nd Party 3rd Party Owned Websites, Apps, Products, Data Platforms ExternalData Appends, SocialProcured Data Partners, Subsidiaries, Affiliates? 6 KEEP CHALLENGING October 2014 In addition to marketing, Code Halos are giving this studio insight into how much its customers are worth.
  • 7. may have a small actual dollar value in isolation. With our predictive model however, we are able to contextualize these characteristics and provide a better look at how much this person will actually be worth to the studio in the long run. Here, a series of discrete data points, otherwise compartmentalized in unrelated line-of-business silos, have been smartly aligned to identify high potential consumers for further targeting. The result is greater than the arithmetic sum of the parts. Code Halos are the magic glue. Summary The best part about a Code Halos initiative is that both sides win. The customer receives a better, more personalized experience with more relevant and interesting marketing communications. The studio benefits from more efficient, targeted marketing campaigns that drive opportunities for additional revenue. As obvious as this may seem, companies often do not know where to get started or how to execute on a Code Halos type of initiative. In these instances it is best to start small and identify opportunities for pilot or proof-of-concept programs. While these may not answer all data questions overnight, they can provide a foundation for a more robust platform from which data can be extracted, cleansed, and studied. Once the foundation is set, layers can then be added over time to improve the sophistication and business value. The bottom line is that Big Data is here to stay. The pipeline of information flowing from all of our devices isn’t going to slow down any time soon – it’s only going to grow. Companies are best advised to get in early and and claim their competitive advantage while industry peers are still trying to hone their strategy around data and analytics. The timing is right. Code Halo programs are still in their infancy at most of the major brands in entertainment. They aren’t simple to implement. In fact, they require significant thought and coordination to truly succeed. However, when implemented properly, Code Halos can be used to optimize marketing campaigns, increase profitability (through higher revenue and cost savings), and create better entertainment experiences for customers. In turn, these new consumer experiences will create important new revenue streams for those companies able to harness the power of Code Halos. Code Halos can be used to optimize marketing campaigns, increase profitability (through better revenue and cost savings), and create better entertainment experiences for customers. THE CONSUMER HALO IN MEDIA AND ENTERTAINMENT 7
  • 8. World Headquarters 500 Frank W. Burr Blvd. Teaneck, NJ 07666 USA Phone: +1 201 801 0233 Fax: +1 201 801 0243 Toll Free: +1 888 937 3277 inquiry@cognizant.com European Headquarters 1 Kingdom Street Paddington Central London W2 6BD Phone: +44 (0) 207 297 7600 Fax: +44 (0) 207 121 0102 infouk@cognizant.com India Operations Headquarters #5/535, Old Mahabalipuram Road Okkiyam Pettai, Thoraipakkam Chennai, 600 096 India Phone: +91 (0) 44 4209 6000 Fax: +91 (0) 44 4209 6060 inquiryindia@cognizant.com © Copyright 2015, Cognizant. All rights reserved. No part of this document may be reproduced, stored in a retrieval system, transmitted in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the express written permission from Cognizant. The information contained herein is subject to change without notice. All other trademarks mentioned herein are the property of their respective owners. About Media & Entertainment Cognizant’s Media and Entertainment practice provides information technology, consulting, and business process outsourcing services for: broadcasting, entertainment (film, music and gaming), advertising and marketing and printing and publishing firms. The growth of digital platforms is causing significant change to these industries and Cognizant is working with clients to help meet these challenges while helping transform their businesses to run better and run different. Leveraging its deep domain and business consulting expertise, Cognizant serves all the major entertainment studios and the top broadcasting companies worldwide. We continually invest in defining what the future of work means for our industry by developing solutions through our Digital Media Lab and working in critical areas such as the Digital Content Supply Chain and Media Asset Management. Visit us online at www.cognizant.com/ information-media-entertainment. About Cognizant Cognizant (NASDAQ: CTSH) is a leading provider of information technology, consulting, and business process outsourcing services, dedicated to helping the world’s leading companies build stronger businesses. Headquartered in Teaneck, New Jersey (U.S.), Cognizant combines a passion for client satisfaction, technology innovation, deep industry and business process expertise, and a global, collaborative workforce that embodies the future of work. With over 100 development and delivery centers worldwide and approximately 217,700 employees as of March 31, 2015, Cognizant is a member of the NASDAQ-100, the S&P 500, the Forbes Global 2000, and the Fortune 500 and is ranked among the top performing and fastest growing companies in the world. Visit us online at www.cognizant.com or follow us on Twitter: @Cognizant.