Netflix is a company that has unique value propositions which allow customers to view TV shows conveniently for a monthly rate. But a common question is how exactly Netflix decides which shows to include in their monthly program set. In his business blog for Maclean’s magazine, Nick Taylor-Vaisey reveals how Netflix collects data from file-sharing websites to determine what people are watching, therefore allowing them to purchase the most popular shows for their customers.

Although seemingly untraditional, this method is indicative of a management information system (MIS). By using a measurement strategy to gauge customer interest in a competing sector, in this case pirated television shows, Netflix is able to gather information and make a decision based on the data. This strategy is especially effective because Netflix is looking at websites where potential customers are going to watch a specific show. The data collected by this system is accurate because instead of gauging consumer interest through experiments or surveys, it looks at what people are actually looking for online.

The case shows that this strategy opens up new channels in which Netflix can reach its customer segment, which are people who want to watch television shows on their own time. It opens channels because Netflix can reach customers who might otherwise watch their favourite shows via file-sharing websites, enticing them to use Netflix instead and possibly become interested in other shows that Netflix offers.