From 3-D television to the Apple iPad, it seems like every week there’s a new technology that threatens to disrupt, reinvent, or otherwise redefine media. These are exciting times, but the frenetic pace of change has forced us to reflect on how we can reinvent ourselves not just to survive, but thrive.
As part of its fourth annual Global Content Study, Accenture surveyed media and entertainment executives worldwide to determine their top priorities and concerns for adapting in this rapidly changing environment. The survey covered the impact of new technologies, predictions for new business models, and how it has created a running battle for consumer attention.
Four key trends emerged which paint a picture of how tomorrow’s media company will have to operate and compete.
Target individuals, not audiences. The days of thinking about audiences in broadly defined demographic buckets are over. As consumers abandon analog and consume more and more content on digital, connected platforms, media companies have been handed an opportunity — an obligation, even — to engage with customers as never before.
The industry executives surveyed agreed. Three-quarters (76 percent) said gathering consumer data through direct relationships is critical for business. But there’s a long way to go: more than half (54 percent) do not believe they are leaders in analytical data collection techniques, and a quarter of the respondents (25 percent) said their ability in this space was “poor.”
The surveyed executives were also asked how they intend to capitalize on these new, direct relationships with consumers. They cited three main goals: developing new offers (77 percent), shaping content production in the future (71 percent), and gaining feedback on the consumer’s experience (50 percent).
Open to letting old platforms go. Not surprisingly, survey participants indicated that traditional content distribution channels such as TV, print and retail are most likely to be threatened by newer channels, including online portals, streaming media and social media.
But they also see these newer channels as real opportunities for growth. Fifty-three percent of the execs surveyed believe mobile and wireless will serve as the primary source of revenue growth in the next three years, followed by online streaming at 44 percent.
It’s imperative that every media company master every channel, delivering the right quality and genre of content to the right consumers via the right platform, building one-on-one relationships along the way.
Doesn’t expect a clear business model. In fact, uncertainty and volatility in this industry are creating an environment where many different business models co-exist, with no single model emerging as an industry standard.
Of the execs surveyed, 39 percent predicted ad-funded models will predominate in three years’ time; 22 percent said the same of traditional paid models; 21 percent listed a hybrid mix of ads and various other revenues; and finally, 18 percent opted for “freemium,” blending a basic “free” ad-supported offering with a “premium” ad-free version.
Only one thing is clear: the trend toward “hybridization,” or mixing and matching approaches across various channels to create multiple revenue streams, is here to stay.
Ready to go big with digital. When it comes to investing in technology inside the company, media companies have made some significant strides, but still have a long way to go.
Despite the recession, more than two-thirds of the companies represented in the survey — 69 percent — increased investments last year in order to transform from an analog, offline business model to an integrated digital enterprise.
As a result, one-third of the companies surveyed are now three-quarters of the way through this transformation, a 12 percent increase from 2007 and 2008, when only one in five companies surveyed (21 percent) were digital enterprises.