Deloitte analysis of the top media trends for 2012DOWNLOAD
24 January 2012: Launching the Deloitte global Technology, Media and Telecommunications (TMT) Predictions for the media sector in 2012, National TMT leader Damien Tampling forecast that despite the schedule being condemned by many over the past decade in favour of the rise of more ‘On Demand’ viewing it does and for some time still will, dominate.
The schedule still dominates
“The reality is that ‘On Demand’ consumption of content is still evolving and PVRs are still not heavily used whilst the penetration of this functionality is increasing” Tampling said. “We predict that the majority of all television programs watched in 2012 will remain either live or where recorded, available via a catch up service, viewed within a week of the original broadcast. It will be interesting to watch how the Optus TVNow case unfolds however, as it really could change the availability of one of the most sought after forms of content – live, sports.
“A decision not to provide some protection, even if that were to require some legislative change, is likely to have a very negative impact on a much larger ecosystem. It may only be the case not because it is an acceptable practice for the long term viability of an industry but because the legislation has simply not been re-considered or adjusted to deal with a new world of connectivity, technology and economic realities.
“Rather than shattering the TV schedule, new technologies have actually given the schedule an ‘elasticity’, that extends it and keeps it surprisingly powerful,” Tampling said. “Even the advent of social networks has enhanced, rather than diminished, the schedule’s appeal, as commentary on programs has in some cases expanded from the living room to a community.
“This may all be because we are hard-wired to prefer routine,” Tampling said. “Our global research indicates that choice is cherished, but choosing can often be a chore!”
“Whatever the reasons the implications of this trend are good for conventional broadcasters as they can and should build on the power of their schedules to show advertisers its advantages, and the opportunities of running campaigns within their context. It will still however be important to keep a close watch on the next generation of IP TV which at the right point in the future one would expect to drive some large step changes in how content is distributed and in fact how consumption is measured.”
A “brand” new day for online ads
The Deloitte TMT global trends predict that the advertising market is set to grow across the board in 2012 with the online branding segment set to outpace the traditional. “While the overall advertising sector will grow five per cent, we predict online branding will expand 50 per cent to $20 billion globally as more companies look to digital to build the long-term value for their brands,” Tampling said.
Our research shows that with the more sophisticated methods for measuring the success of online branding campaigns - such as Real Time Bidding which allows companies to specify exactly where and in what context their ads will appear – are driving digital marketing campaigns to transform from their humble banner ad beginnings.
“Advertisers have also increasingly turned their efforts to tailoring adverts specifically for the online world via videos and social media campaigns. As companies leverage this opportunity to develop new skills as the prominence of digital branding increases, the value and appeal of partnering continues to grow,” he said.
Adding weight to this consideration is the fact that in Australia the proliferation of digital multi channels in the Free-To-Air (FTA) space which has led to some fragmentation of audiences across those new channels. Because the FTA audience size has remained relatively static, the bad news is that some networks have been cannibalising their high yield channels with their new lower yield channels. “This coupled with the massive increase in channel inventory, will mean a dramatic increase in competition for advertising revenue and potentially increased costs to create compelling content to drive that revenue,” Tampling explained.
Online coupon intermediaries: from novelty, to celebrity, to sizable niche
The online coupon sector has evolved rapidly from novelty to celebrity over the course of 2011, but in 2012 it is likely to settle into a small niche, “albeit one that generates billions of dollars in revenue,” said Tampling. “In Australia those niches include holidays, wine, food and events,” he said. Across the world, the sector’s rapid evolution means that hundreds of companies will disappear during 2012 as competition continues to intensify and margins are put under pressure. With the number of people using online vouchers also predicted to decline moderately.
“The opportunity is there for the reputable intermediaries that sit between the consumer and the retailer to continue to generate significant dollars. However they will need to increase the quality and variety of the offers available. And they may also need to accept lower commissions on sales of coupons - which currently can reach 50 per cent - to entice more retailers to consider using their services. The intermediaries will also need to shift their focus from purely large discounts, and beef up their value proposition to be one of utility or specialisation, in order to amplify and enhance the perception of the service they offer,” Tampling recommended.
“In this 11th consecutive TMT Predictions report compiled by Deloitte with input from clients, analysts and TMT practitioners from more than 20 countries around the world, we identified seven trends overall,” Tampling said.
In 2011 the Deloitte TMT predictions were more than 80 per cent accurate including calling new markets and exposing hype that was ahead of reality. The aim of the predictions is to initiate discussion and debate across each sector and outline the implications for businesses, industries and governments.
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