The Future of Media has been produced by The MIL.
Any sufficiently advanced technology is indistinguishable from magic.
Arthur C. Clarke
FOREWORD The Australian media landscape has changed and will continue to do so at an increasingly, accelerated rate. This is a challenging reality for advertisers and marketers alike.
As recent as 10 years ago, who would have thought that nearly 70% of all Australians would be accessing a social network monthly (and 50% of us accessing it daily)? Who would have thought that over 15 million of us would be watching video on YouTube every month whilst TV shows now regard reaching over 1 million viewers a success? And 10 years ago a little thing called the iPhone launched‌ and everything changed!
THE BIG 7 OVER THE NEXT 5
Over the next 5 years the following 7 areas will become more prevalent in media and marketing 1. Empathy and innovation 2. Sponsorship goes virtual 3. Beware the creepy line 4. Generation C 5. Meaning trumps moments 6. Content is not king 7. Digitsation and consolidation of media
The exact future of Australian media is unknown. 2 things are certain however‌ It will be different It will be rooted in today By looking at how the constantly changing forces of technology and consumer behavior are impacting media, we can make some educated assumptions into how Australian’s will consume media differently over the next 5 years. And how brands can connect in a more meaningful way.
WHAT DOES IT MEAN TO BE AUSTRALIAN?
The Australia of today owes its past accomplishments and future opportunities to the contributions of more than 300 different ancestries, from the first Australians to our newest arrivals.
Source: ABS Top 4 Migrant Countries to Australia 2016 This is predicted to change in the next 5 years – driven by an increasing Chinese influence
AUSTRALIANS ARE NATURAL EARLY ADOPTERS Australia is ranked third in a list of countries that have adopted digitisation rapidly. Nearly three quarters of Australians use mobile phones to access the internet, making us one of the most mobile connected countries in the world. Our mobile subscriptions (almost 27 million) exceeds our total population (23.5 million).
AUSTRALIANS ARE DISRUPTION SAVVY
Consumers are very knowledgeable about cycles of tech disruption – whether big or small. This savvy mindset is something that has accelerated in the last 10 years. Living in faster times means they have had to embrace and incorporate tech-enabled change into their daily lives.
WE ARE ADOPTING NEW TECHNOLOGIES FASTER THAN EVER
TELEPHONE
COLOUR TV
COMPUTER
MOBILE
INTERNET YR 10
YR 20
YR 30
YR 40
YR 50
YR 60
YR 70
Source: Deutsch LA: Time taken for technology to penetrate +50% of the US households
To thrive in tomorrow’s environment, the industry should approach every new technology as a business model opportunity Megan Brownlow, PwC Executive Director
Looking at technology across three horizons
Markets
INVENTION
INNOVATION
ITERATION
Technology
THE INTERNET OF THINGS (IoT). A CONNECTED FUTURE – ENHANCING OUR DAILY LIVES There are expected to be 75 billion connected devices by 2020, meaning there will be ten times as many devices able to talk to one another as there will be people on the planet! Smart Products Roadmap
The internet of things presents a fantastic opportunity for marketers. Products that market themselves, order themselves and integrate into an ecosystem, will increase customer retention.
IN THE WORLD OF THE IoT, VOICE BECOMES MORE IMPORTANT Voice is beginning to replace typing in online queries. Twenty percent of mobile queries were made via voice in 2016, while accuracy is now about 95 percent.
AI BEGINS INFILTRATING ALL PARTS OF THE CUSTOMER JOURNEY AI AI AI AI AI AI AI
for content curation for customer service for content generation for sentiment analysis for CRM for intelligent digital advertising optimisation to power chatbots
BOTS: PERSONAL ASSISTANTS OR ADVERTISING CHANNELS? It is predicted that 85% of customer interactions will be managed without a human by 2020. Armed with data and serious computing, they can analyse patterns in our speech to decide when and what to advertise. They can also increase engagement and
bring your brand personality to life. Bots will have the capability to learn our social and behavioural patterns to not only advertise relevant products but to also provide personal assistance like a (human) PA.
CHATBOTS WILL CLEARLY HAVE A SIGNIFICANT ROLE TO PLAY IN FUTURE CUSTOMER RELATIONS Empathy will become a key discipline in an increasingly AI world. Facebook is also doing more with “parametric QR codes”. Businesses, event planners, and developers can use them in the offline world to connect customers with a chatbot to find out more information.
AI AND CHATBOTS WILL IMPROVE MARKETING EFFICIENCIES THROUGH VIRTUOUS ALWAYS ON FEEDBACK LOOPS
VR AND AR ARE ON THE RISE
AR TO BECOME INCREASINGLY FAMILIAR
The success of Pokemon Go has propelled AR in to the mainstream Microsoft’s HoloLens is technically Mixed Reality and demonstrates how AR, as a core technology, can be built into other devices
AR HAS A BIG SUPPORTER I regard it as a big idea like the smartphone. The smartphone is for everyone, we don’t have to think the iPhone is about a certain demographic, or country or vertical market: it’s for everyone. I think AR is that big, it’s huge. Tim Cook CEO, Apple
Apple just launched ARkit - an augmented reality platform for developers – at WWDC 2017, which will make more accessible and ubiquitous. AR is also seen by many as a natural consumer stepping stone to VR.
BRANDS ARE BEGINNING TO USE VR EFFECTIVELY Samsung Gear VR’s new VR Live Pass service, which in addition to UFC fights, will also include live events from the X Games and concerts from Live Nation. Critical mass of the technology is still a few years off…
THE ESPORTS JUGGERNAUT League of Legends World Championship Attracted more than 20,000 in-person attendees And another 43 million viewers online.
THE PEOPLE WHO PLAY VIDEO GAMES – 68% OF THE POPULATION – HAVE NEVER BEEN MORE DIVERSE And this will continue to become more mainstream in the next 5 years
Source: ABS Top 4 Migrant Countries to Australia 2016 This is predicted to change in the next 5 years – driven by an increasing Chinese influence
The explosive growth has started catching the eye of big-spending marketers including Arby’s, Audi, CocaCola, PepsiCo, Gillette and Bud Light. The global esports economy—which includes media rights, advertising, sponsorships, merchandising and ticket sales—will grow by 41% in 2017 to $696 million and reach $1.49 billion by 2020
Sponsorship revenue is expected to reach $266 million in 2017, while ad spending on esports will hit $155 million
ESPORTS TO BECOME MORE LOCAL AND MORE FAMILIAR
The AFL believes eSports’ 239 million annual global audience, made up of mostly millennials, is an attractive market for the league and its clubs to expand their brands into. Adelaide Crows have just bought eSports outfit Legacy, one of Australia’s eight top-tier teams that competes in the Oceanic Pro League playing the game League of Legends. Legacy eSports are based in Sydney and the sale is reputed to be in the 6 figures
FUTURISTIC TECHNOLOGY TAPS INTO ALL THE SENSES
Haptic technology allows people to feel the media
Epicenter is a startup that plans to implant microchips into people allowing for more interactions with generic technology to take place seamlessly
Elon Musk’s Neuralink is a chip that gets implanted in your brain – turning cloud based AI in to an extension – apparently letting people communicate by “consensual telepathy”
The next 5 years of technological innovation will bring with it huge amounts of data on 3 fronts
VOLUME VELOCITY VARIETY
MARKETING TECHNOLOGY, LEVERAGING THE HUGE AMOUNTS OF DATA HAS DISRUPTED MARKETING 2011 2012 2014 2015 2016
150
2017 350 1000 2000
Making it easier to segment and target audiences at scale
3500 5000
HOWEVER, BEWARE THE CREEPY LINE When it comes to data, from the consumer’s perspective privacy beats personalisation. Consumers are awake to the idea that they have only one PII (Personally Identifiable Information) – brands that breach personal space will need an invitation first. An unwarranted breach will create brand rejection. As marketers we need to RESPECT People’s data and their privacy
RESTRAIN From doing everything we can with peoples data
REWARD People with relevant and meaningful experiences
TECHNOLOGY OUTTAKES 1. Empathy and innovation 2. Sponsorship goes virtual 3. Beware the creepy line
In the connection economy, trust and relationships are the new currency.
Seth Godin
WE ARE ALL PART OF GENERATION C (CONNECTED) Defined not by age, geography, or income, but by behaviour. That is, digital behaviour. Gen C is not an age group – it is a way of life. Its members could include your precocious pre-teen or your tech-savvy grandmother Brian Solis
WE LIVE IN A TIME OF ABUNDANCE More choice . More content . More control . More distraction
Instagram’s photo cache grows by 80m each day. YouTube sees 400 hours of video uploaded every minute, and more than 250,000 status updates are posted to Facebook in the same span. You could never read and see everything online. Not in 100 lifetimes. Not even if you never ate or peed or worked again. David Pierce, Wired That’s a blessing and a curse for individuals, but increasingly, it’s a thorn in the side of brands and traditional publishers.
CEASELESS CONNECTIVITY HAS FRACTURED CONSUMERS’ RELATIONSHIP WITH TIME AND IRREVOCABLY ALTERED ATTENTION SPANS
12 seconds
seconds
The average human attention span in
The average human attention span in
2000
8
9
seconds
2015
Source: Google
WE ARE LIVING LIFE AT THE EXTREMES
Seeking to speed through some experiences, and slow down to savour others, one constant objective remains… To extract maximum value from every moment.
CONTENT WON’T BE KING
BRANDS WILL NEED TO BECOME PUBLISHERS OF ORIGINAL CONTENT Studies show that original content is more influential in creating context for influential advertising compared to UGC. Marketers will need 10X the content they make today And it will need to be more ‘ephemeral’ Long form will be 15” The new norm is 5” Sequence is the new frequency Need more content, run each item once to each consumer and build brand story with sequence.
Conscious consumers . Individuals . Active choosers Values oriented . Contributing cultures
Be self aware, rather than a repetitious robot. Bruce Lee
HOWEVER, CONTENT CRACKS ARE APPEARING
Conspicuous consumers . Mass market . Passive receivers Image and ego . Consuming culture
‘Caution: The media is NOT a reflection of reality.’
BRANDS SEEKING A MORE MEANINGFUL CONNECTION WITH CONSUMERS NEED TO MAKE CONSIDERED DECISIONS ABOUT WHAT SIDE OF THE DIVIDE THEY WANT TO BE ON. In the age of short attentions spans, always on communication and the bombardment of information, it is essential for brands to align their values and messaging to the conscious and aware consumer. Successful brands of the future are those that avoid mass and impersonal connections. They need to seek audiences driven by an aligned purpose and, as a brand, add value to their lives in times that matter to them in a way that resonates with them.
INCREASINGLY LOOKING FOR ACHIEVEMENT & FULFILMENT SELF ACTUALISATION Consumers desire to feel in control, to feel understood and be seen as an individual.
ABILITY Desire to live a self constructed life is being matched by the increased ability to do so.
THEY ARE REDEFINING WHAT STATUS MEANS STATUS DIVERSIFICATION ‘Choose time over money and people over stuff.’
POST-MATERIAL ‘If you want to be interesting, be interested.’
POWER OF EXCLUSIVITY ‘Give me what no other has ever gotten and I’ll give you what those others tried to get.’
AND CHANGING THEIR DEFINITION OF LUXURY Man’s main dream is not to gain pleasure or to avoid pain but rather to see a meaning in his life.
The longer-term strategic challenge for luxury brands will be the epic shift towards more varied, complex, individualised, and meaningful forms of luxury consumption. Seeking meaning from our means. Sustainability, health, and family. Luxury is becoming more inward and personal than outward and social.
Viktor Frankl Source: Trendwatching: The Future of Luxury
BRANDS NEED TO BE SOCIAL (NOT DO SOCIAL) Think in terms of social values rather than social media. When it comes to social media engagement, consumers are more likely to purchase from brands that are being honest, friendly and helpful through their social media presence – is it in line with consumers’ sentiment and beliefs and in line with the brand?
#STANDWITHME
GENERATION C BLURS THE EDGES Consumers are seamlessly and effectively blurring online and offline. Brands will need to become more contextualised, more personalised and targeted to deliver relevant and timely messages to a specific audience.
NEED TO FOCUS ON CONSUMER JOBS TO BE DONE
Brands need to understand why costumers choose to “hire� their product or service in order to complete theirs jobs. Consumers want to feel unique and be treated as an individual. People want services and products that they can tailor to their own tastes and needs.
Source:Clayton M Christiansen
IT’S ABOUT MAKING MOMENTS MATTER Low Intent
Micro Moment
VS.
Macro Moment
High Intent
BEHAVIOUR OUTTAKES 4. Generation C 5. Targeting will be based on action/behaviour 6. Meaning trumps moments
So how are the two forces of behaviour and technology likely to impact the world of Australian Media over the next 5 years?
BY 2020 AD SPEND WILL BE DOMINATED BY DIGITAL
Total ad spend is expected to reach $17.3 billion by 2021, with internet advertising reaching $10 billion or approximately 50 percent of the market.
DIGITAL SPEND IS FORECAST TO INCREASE ACROSS ALL SECTORS
GROWTH DRIVEN BY SEARCH AND VIDEO
INCREASINGLY EVERYTHING WILL BE MOBILE…
ANALYSTS ADD TO SENSE OF DOOM FOR TRADITIONAL MEDIA
Advertising revenue for newspapers and free-to-air television will collapse, by more than $1.6 billion over the next four years, as Facebook and Google extend their dominance of digital media, figures show.
Some people think so Tim Cook CEO, Apple
Some people don’t Mark Ritson Associate Professor of Marketing
OR IS IT THE 30” TVC THAT IS DEAD?
Advertising $ = Internet > TV within 6 months, Global
Source: Mary Meeker
THE CURRENT ‘SHARE OF’ DEFINITION IS NO LONGER RELEVANT
Even today, talking about which TV station ‘won’ the ratings the previous night is pointless, given the broader competition for people’s attention
Share of Australian TV viewing
Share of Australian entertainment options
Share of global entertainment options
PRINT HAS BEEN HIT HARD IN RECENT TIMES BUT CAN AND IS DIGITISING THEIR CONTENT IN ORDER TO REMAIN RELEVANT
In 2002 Newspapers enjoyed 41% share of the advertising market. It now sits around 7.7% of the total ad spend and continues to decline‌ But increased digitisation of product will help combat the losses.
Source: PwC Outlook 2017
OOH CONTINUES TO SEE SUSTAINED GROWTH
Source: PwC Outlook 2017
OOH HAS BENEFITED FROM ADAPTING TO THE DIGITAL WORLD
Increasingly networked and automated OOH infrastructure will facilitate programmatic advertising, and provide the ability to personalise ads and automate and dynamically manage inventory.
RADIO AND AUDIO
Similar to OOH, radio has adapted well to digitisation. Helped by its role as a secondary medium. Competitors like Spotify and Pandora also present opportunities to grow their own audience through new platforms. Podcasts are also on the rise (up 14% since 2015) as are audio books.
ULTIMATELY ALL MEDIA IN THE FUTURE WILL (HAVE TO) EMBRACE DIGITAL Traditional media will need to balance digitisation and diversification of products and services with tradition and legacy.
MEDIA CONSUMPTION IS CHANGING BUT IN THE FUTURE, MEDIA OWNERSHIP WILL CHANGE TOO DRIVEN BY MEDIA LAW REFORM The Propositions 1. End of the 2 out of 3 rule Companies will be able to control more than two of three radio, television and newspapers in an area. 2. Axing of TV licence reach prohibition Proprietors will be able to control a TV licence that reaches more than 75% of population.
DIGITISATION AND CONSOLIDATION Our Predictions Expect 2-3 vertically integrated media companies. Along with specialist platforms. Partnership will be key to protect competitive position. Trading currency will shift – engagement, transaction and content licensing will become more commonplace Trading currency will shift Engagement, transaction, content licensing will become more commonplace
MEDIA OUTTAKES 7. Digitsation and Consolidation
REVISITING THE BIG 7 OVER THE NEXT 5 1. Empathy and innovation 2. Sponsorship goes virtual 3. Beware the creepy line 4. Generation C 5. Meaning trumps moments 6. Content is not king 7. Digitsation and consolidation of media.
THE REALITY IS WE HAVEN’T SEEN ANYTHING YET!
We’re just at the beginning of the beginning of all these kind of changes. There’s a sense that all the big things have happened, but relatively speaking, nothing big has happened yet. In 20 years from now we’ll look back and say, ‘Well, nothing really happened in the last 20 years. Kevin Kelly
BACK TO THE FUTURE‌ No longer can businesses rely on one dimensional marketing and communication; we, as consumers,
demand more. The accessibility of technology, the expectation of relevant content and the growing need for personalisation are shaping a brave new world of connected experiences. In today’s world, and as we look to tomorrow, brands are witnessing the grand redefinition of media. Traditional communication, advanced automation, artificial intelligence and data proliferation are blurring our understanding of media. However, the brands that will succeed in this new world will not be those that simply embrace new technologies or tap into the limitless streams of available data. They will be those that connect with consumer values and emotions in the moments that matter to them. To be a successful brand, is to be a meaningful brand.