The coronavirus pandemic has given rise to an ongoing surge in media consumption, as people around the world seek to remain updated on the rapidly changing crisis.
This is altering the landscape for advertisers in developed and emerging markets alike, as well as giving media companies a chance to leverage enhanced engagement.
Globally speaking, the early months of the pandemic saw a dramatic increase in the amount of time people spent accessing information about current events.
A June report from data analytics company Nielsen found that in March individuals in the US spent 215% more time reading news online relative to the same month last year.
This figure was 180% in Italy, 125% in Thailand, 78% in Japan and 52% in Australia.
Television consumption also increased. In early March Indonesians watched an average of 180 minutes of television per day, a figure which rose to 209 minutes by the end of the month.
This trend was paralleled in other emerging markets, with television consumption over the course of March rising from 208 to 307 minutes per day in Malaysia, 173 to 230 in the Philippines, 215 to 248 in Mexico, and 125 to 145 minutes in Thailand.
Although the pandemic has disrupted traditional revenue streams, highly engaged audiences provide an opportunity for media firms to grow their subscriber base, and for advertisers to expand their reach.
Released in April, a World Economic Forum survey of 9100 participants from China, Germany, India, South Korea, the UK and the US found that, while just 16% of respondents paid for news content at the time, 53% said they would consider doing so in the future.
In particular, digital advertising has seen notable growth. For example, trade group Interactive Advertising Bureau expects US digital advertising sales will be up 6% in 2020.
This trend is likely to be mirrored in international markets. WARC anticipates digital advertising will outperform traditional outlets, projecting a global boost in ad spend on social media (9.8%), online videos (5%) and online searches (0.9%).
Growth in digital advertising comes despite expectations for an overall drop in promotional expenditure in 2020 as many companies adopt a cautious approach in an uncertain environment.
Overall, WARC anticipates international media outlets will see a 16.3% decrease in ad revenue this year.
Shift to streaming
With profits affected by the pandemic, media and technology groups are looking to diversify sources of revenue and attract users to subscription-based services such as streaming, thereby tapping into an increasingly popular source of content.
As OBG noted in June, GoPlay, the video streaming service of Indonesia’s multi-purpose app Gojek, announced that it had secured funding from Singapore’s Golden Gate Ventures and Chinese investment firm ZWC Partners.
Although the total was officially undisclosed, regional media reported funding of around $15m. This development was seen as a vote of confidence in GoPlay, which launched in September last year.
Elsewhere, telecoms company Airtel Nigeria expanded into television services in January following the launch of its Airtel TV platform, and is now expected to grow this service in response to pandemic-related changes in consumer behaviour.
Large media conglomerates are also expanding into streaming. In late May US-based premium cable giant HBO introduced its HBO Max streaming service, and the US television network NBC followed suit in mid-July with Peacock.
“A permanent shift has taken place from a linear platform to a digital platform,” Alexia Quadrani, head of US media equity research at JP Morgan Research, noted in a May report. “All traditional media companies are now assessing whether to build their own in-house capabilities or buy.”
Recent examples in the US signal a trend of conglomerates adding streaming services through acquisitions. In January 2019 US-based ViacomCBS acquired Pluto TV, an advertisement-supported streaming service. A little over a year later US telecoms and entertainment giant Comcast acquired XUMO, an over-the-top internet television service also based in the US.
Broadly speaking, a shift towards streaming and digital services reflects the so-called new normal, in which people feel empowered to blend different approaches to work, life and entertainment.
“I think we are going to live in a vastly different post-pandemic world, which will involve significantly more flexibility,” Marc Barnett, CEO of Malaysia-based streaming service iflix, told OBG in April. “That kind of flexibility flows into a broader sense of freedom, which will dictate how people want to consume entertainment.”
If these new consumption patterns hold, the move towards digital media services and corresponding shifts in advertising spending will be consolidated over the longer term.
This article was written by Oxford Business Group, the highly acclaimed global publishing, research and consultancy firm. The views and opinions expressed in this article are those of the authors and do not necessarily state or reflect the views of Thailand Business News