BBC failing on personalisation: Spending 5% of Netflix
A 23% staff turnover in product is a warning sign...
The BBC has yet to develop a comprehensive strategy to deliver a personalised digital experience and its limited budget for digital means it has “not been able to invest substantially in improving its audience metadata” – with the broadcaster spending just 5% of what Netflix does on technology and development.
A 23% turnover rate in its product group is not helping, nor are salaries that cannot compete with those offered by private sector amid hot competition for data scientists, engineers and other specialists.
That’s according to the National Audit Office (NAO), which noted that the BBC spent £98 million on digital product development in 2021-22 (1.8% of its £5.3 billion income for the year) versus Netflix’s £1.7 billion, in a wide-ranging view of the BBC's digital efforts that was published by the auditor this week.
The BBC’s Director-General, Tim Davie, announced a “digital first” strategy in June 2022. But the BBC’s efforts have been complicated by the fact that a massive 88% of the time audiences currently spend with the BBC is through traditional television and radio broadcasting rather than digital portals like the BBC iPlayer.
The NAO added: “The BBC is required to maintain a broadcast presence for national resilience purposes and has put in place robust technology infrastructure arrangements for this” – suggesting that these arrangements have not been “regularly challenged to identify whether there is any scope to achieve savings.”
Yet even on iPlayer work on personalisation has been slow: the BBC only produced a sign-in strategy in September 2021 that would let it start meaningfully capturing more first-party data, “with a target for 72% of digital product views to come from signed-in users by 2023” as NAO noted in its “Digital BBC” report.
Digital personalisation is challenging
Effective personalisation remains the holy grail for companies spanning sectors as diverse as consumer goods; travel, leisure, and hospitality; and broadcasting among many others.
As an example of what others are doing, Expedia’s Group CTO Rathi Murthy this month showcased how the company can spin up a stunning 360,000 permutations of one page of one of their brands to ensure personalisation. (The company is using machine learning at scale to make nearly 600 billion predictions per year, powered by over 70 petabytes of data.)
Others, particularly on the retail side, like Nike, have focussed their personalisation efforts on a membership-based model, underpinned by apps that allow direct-to-consumer nudges, as well as genuinely personal data collection and collation; a strategy that brands like Manchester United are also following.
Yet as Amit Rawal, Apple’s Head of Product: Global Digital Analytics & Insights, has previously noted: “True one-to-one personalisation at scale is extremely hard. In my experience, if Personalization needs to become part of the Customer Experience DNA, then it needs to be owned by a strong leader in the organization, whether it’s the CMO or CDO. Plus, a CEO mandate that creates alignment across the various functions of marketing, technology, analytics, and operations can ensure the necessary long term commitment.
“You can have the best technology platform but [if you] don’t have strong skill-set of data science and Martech in the team, which can work independently with an agile operating model, the full potential of the investment will not be realized. [But assuming] your current tech stack is flexible with a service-oriented architecture, you should be able to cherry-pick best-of-breed technology services that can collectively serve as a robust personalization platform” he added – assumptions challenged at an institution like the BBC that is perennially under cost-cutting pressures and unable to match the salaries of digital change-makers in the private sector.
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NAO recognises that latter challenge, pointing out that in its product group, the BBC had a “23% staff turnover rate as of June 2022. The high number of vacancies is slowing technical development. Owing to the number of vacancies in the search team, for example, the BBC has been unable to develop its search function further.”
Institutional challenges at the BBC like uncompetitive pay and/or institutional inertia can be challenged by inspiring leaders, helped along their way by the fact that the BBC does have a clear and attractive mission and, as NAO notes, “overall, the BBC’s key digital products, and most notably iPlayer, have to date performed well. These levels of performance are impressive given available funding is considerably lower than other media organisations with which it competes for audiences, many of which are digital-only…”
The BBC’s operating model splits digital responsibilities split into three functions: The technology group, responsible for operation, security and innovation of the BBC’s technology; the product group, responsible for developing and delivering the BBC’s audience-facing digital products, such as the News Online app; distribution and business development, responsible for broadcast and online distribution and distribution tech partners.
One potential challenge to improved BBC personalisation is the risk around user data management. The BBC has “improved its approach to users’ data and data protection, including appointing a data protection officer and creating a central Data Protection Office team in 2019” NAO said but warned that “in reviewing BBC planning documents on using customer data we found no references to its approach to the management and mitigation of reputational and other potential risks that could arise as it increases its use of such data.”
