3 Reasons Consumers Are Driving Digital Change

The latest edition of the Global Entertainment and Media Outlook: 2010-2014, has just been issued by global consulting firm PricewaterhouseCoopers (PwC).

The report forecasts modest growth in entertainment and media spending worldwide over the next four years, with much of the emphasis on digital media. But what’s behind the numbers is perhaps of greatest interest to online marketers. Consider these “three themes” identified by PwC to gain some insight into the digital media environment going forward:

1) Rising power of mobility and devices.

PwC says “increasingly converged, multi-functional mobile devices” will come of age as a primary platform for communications by the end of 2011. The movement to “consume and interact with content anywhere, anytime – and to share and discuss that content experience with others via social networks” is expected to be a driving force that information providers will have to accommodate. The number of U.S. mobile Internet access subscribers will likely reach over 96 million by 2014, according to PwC.

2) Growing dominance of Internet experience over all content consumption.

The Internet has caused a fundamental shift in the consumer’s mindset. Now the consumer “expects all forms of media to embed the convenience, immediacy and interactivity of the Internet.” This suggests that at least three existing media will dramatically change: television will finally become Web-enabled, Internet-enabled devices like the iPad will increase in popularity as magazine and newspaper content delivery platforms, and music CDs and even digital downloads will be replaced by streaming personalized music services. The same is likely to be true of video.

3) Increasing engagement and readiness to pay for content – driven by improved consumption experiences and convenience.

If – and this is a big if – content is combined with convenience and usage flexibility, consumers will consider paying for that content. But the content will have to incorporate personalization “and a differentiated experience that cannot be created elsewhere.” Consumers might also be more willing to pay for content that has local relevance, which is why localization is a hot topic these days.

These very trends are often discussed on ReveNews, so it’s reassuring to get validation from a major consulting organization. But PwC cautions businesses they’ll need to make changes, too. They warn that “digital migration and consumer behavior changes have put extreme pressure on existing business models. …There is no ‘one-size-fits-all’ approach for E&M [Entertainment & Media] companies to stake their position in the digital value chain. The continued fragmentation of the E&M sector will fuel greater experimentation by both established industry giants and niche players in adopting business models that include hybrid combinations of advertising and subscription approaches.”

This may be why you’re seeing a lot of experimentation by Google, Facebook, Twitter and other established leaders, and why up and coming players like Foursquare and Gowalla are attracting significant attention. Providers on the hardware side of the business are scrambling to stay level with Apple’s iPhone and iPad.

It’s interesting that the three trends noted by PwC really converge into one over-riding consumer desire: to be connected and informed all the time. The consumer is indeed driving massive digital change. Those marketers who recognize how to meet that need will be the ones to succeed in this rapidly evolving marketplace.

About Barry Silverstein

Barry Silverstein is a freelance writer/marketing consultant. In addition to writing for ReveNews, he is a contributing writer to Brandchannel.com, the world’s leading online branding forum. He is the author of three marketing books, The Breakaway Brand (co-author, McGraw-Hill, 2005), Business-to-Business Internet Marketing (Maximum Press, 2003) and Internet Marketing for Technology Companies (Maximum Press, 2003). Barry ran his own Internet and direct marketing agency for twenty years. You can find Barry on Twitter @bdsilv.

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