Both digital advertising and broadband are entirely digital, and digital components fueled the growth of spending on video games. At the other end of the growth spectrum, expenditures for traditional no digital media, such as consumer magazines and newspapers, continued to decline.
While today’s stronger segments will continue to be strong over the next years, expenditures on the slower growing or declining segments of 2015 will decline more slowly over the next years.
These patterns reflect two primary drivers of spending on media:
- The shift to digital.Spending on media continues to move at a rapid pace from traditional to digital products and services. International researches estimate by 2019, that digital will account for more than 50 percent of the overall total for media. Digital, consisting of Internet and mobile ads, will become the largest advertising category surpassing TV. Mobile will more than double its share of the digital-ad market. This rapid shift to digital is driven in part by the growing number of connected consumers, the expansion of mobile telephony, and higher rates of mobile-broadband adoption.
- Developing markets.Increasingly, developing markets play a critical role in the growth of spending on global media. In fact, the Asia–Pacific media market will be the largest source of absolute growth for the global industry during the next five years.
Shifting consumer behavior, disruptive technologies, convergence and quadruple-play offerings will drive merger and acquisition activities and major transformation with media companies.
Across all media sectors, companies must rump down traditional offerings, ramp up new revenue streams, and innovate business model. They also must improve operational efficiency, strengthen brand perception, and identify new opportunities for value creation.
become a leading providers of high-quality content
while fulfilling their mandate to provide public service.
This doesn’t mean abandoning the traditional business of delivering national and regional television programming. Rather, PSBs should strengthen their online activities to become integrated providers of content across all media platforms and extend their offerings across multiple channels to reach every age group.
PSBs can do this by:
- Measuring touchpoints. A touchpoint is a single contact with any media platform during a 30-minute activity. Measuring this metric allows public broadcasters to map the media journey of consumers throughout the day and generate new insights into what really makes content relevant to target audiences. This activity gives broadcasters a comparable view of how media are consumed across platforms and enables them to capture parallel usage.
- Fine-tuning the content portfolio. Once PSBs understand the unique consumption behavior of all target groups, they need to aggressively refine their content portfolios.
- Responding to genre economics. By analyzing the cost versus benefit for each genre and subgenre, PSBs can assess how much it costs to reach a certain level of consumption per genre and how much of that cost can be financed through advertising, sponsorship, or licensing fees.
- Building cross-media capabilities and structures. PSBs need to break down the conventional silo structures that separate television, radio, print, and online media, and then integrate each platform throughout the organization. That way, PSBs can build cross-media capabilities in everything from market research and advertising to innovation and human resources.
- Making funding sustainable. By adopting a more analytical approach to investments, PSBs can achieve significant costs savings and generate new revenues through cross-media advertising. PSBs should also seek out revenues beyond pure programming, such as video-on-demand services, second-service offerings, and online gaming. At the same time, PSBs that maintain their relevancy will be in a stronger position to sustain support for public funding.
Despite the think newspaper and magazine publishing is a dying business, print media companies that will successfully transform their business in the digital age will actually strength their brands and will continue to grow readership and revenues.