Netflix has replaced its 5-star rating system with 'thumbs up, thumbs down' - here's why

For a few years, Netflix has wanted to replace its five-star rating system with something better.

Now, after a year of testing, the streaming giant has released its new and improved rating system into the wild. Instead of stars, what you'll see if you fire up Netflix today is both a new "thumbs up/down" feature, which lets you rate titles, and a "percent match" score that predicts the shows and movies you'll like based on your taste.

Why the big change?

Netflix's Cameron Johnson, who oversaw the shift, told Business Insider that it all came from the realization that Netflix had always used star ratings differently than the rest of the internet, but that this distinction wasn't clear to users.

Netflix's star ratings were personalized, and had been from the start. That means when you saw a movie on Netflix rated 4 stars, that didn't mean the average of all ratings was 4 stars. Instead, it meant that Netflix thought you'd rate the movie 4 stars, based on your habits (and other people's ratings). But many people didn't get that.

"That's not the way people are used to using star ratings on e-commerce ratings" Johnson said. Take Amazon, for instance. "In those contexts, those star ratings are an average." People assumed Netflix was the same.

This was a problem because people weren't as motivated to rate titles when they thought they were just a drop in the bucket of all Netflix reviews. They didn't understand that the more they rated, the better the system would be at understanding their tastes. "People don't intuitively think about it that way," Johnson said.

So when looking for a replacement, Netflix wanted to make sure that was clear. That's why Netflix settled on "thumbs up/down," which is widely understood to imply that you are training an algorithm to know what you like, Johnson said.

"That simple change led to an over 200% increase" in ratings, Johnson said. The inclusion of a "percent match" number also reinforces the idea that these recommendations are personalized, he added.

Everyone's a critic

The other problem Netflix hopes the change will take care of is people's tendency to get into critic mode when they see star ratings. Instead of saying how much they enjoyed a show, they tried to assess its objective worth.

"What we observed was a difference between what [users] say," in terms of ratings, "and what they do," in terms of actually watching. People might rate a guilty-pleasure sitcom low and then keep watching, and watching, and watching.

"What we saw with 'thumbs up' and 'thumbs down' more aligned with what people actually play," Johnson said.

One last hidden benefit to switching: If you "thumbs down" something it won't ever appear on your Netflix homepage again. Johnson said Netflix subscribers had been asking for a way to get Netflix to stop suggesting a title. Now you have it.