Personalisation, tech advances demands drive innovation in entertainment and media | Media Analysis | Business
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In what the management consultancy calls a fundamental shift, media and entertainment companies are taking advantage of data and usage patterns to pitch their products not at audiences of billions, but at billions of individuals says PwC.
PwC Outlook 5June2019
According to its Global Entertainment & Media (E&M) Outlook 2019–2023 report, PwC found that today’s consumers are embracing the expanding opportunities to enjoy media experiences tailored to their needs, and companies are designing offerings and business models to revolve around those personal preferences.

The result says PwC is an emerging world of media that’s more personal than ever before: one in which empowered consumers control their own media consumption via an expanding range of smart devices, curate their personal selection of channels via over-the-top (OTT) services and bring more media content into their lives by embracing the smart home and connected car.

The report provides revenue data and forecasts for 14 industry segments across 53 territories and projects that total global spending on E&M will rise at a compound annual growth rate (CAGR) of 4.3% over the next five years, to 2023. This growth rate will see the industry’s global revenue reach US$2.6 trillion in 2023, up from US$ 2.1 trillion in 2018.

Looking at specific E&M segments, virtual reality (VR) maintained its position as the highest-growth segment, but after a year in which consumers’ take-up continued to lag behind expectations, its lead over the OTT video segment was seen to be greatly diminished. PwC noted that the traditional TV and home video segment now has negative growth expectations for the first time, as cord-cutting by consumers continues to rise and sales of DVDs keep plummeting.

At the heart of this are advances in technology and service offerings which are enabling people to move from passive to active consumption, not just of individual pieces of media says PwC, but of media as a whole. Consumers are rejecting the bundles of channels offered by cable or satellite providers and are instead constructing their own ad hoc bundles made up of OTT services. PwC calculates that global OTT revenue hit US$38.2 billion in 2018 and it forecast that this will almost double by 2023.

As E&M companies reinvent their organisations and offerings for an increasingly personalised world, PwC believes that four priorities are coming to the fore: one size does not fit all; the number of consumer touch points is expanding; technological innovation introduces a new era of personalised computing; trust and regulation remain pivotal, as personal data hygiene becomes key. PwC also warns that as personal connections proliferate, however, consumers continue to be concerned about the safety and privacy of the data. And that with trust at a premium, pressure is intensifying on companies to adapt to new privacy regimes.

“The personalisation wave — fuelled by evolving customer behaviour — is set to be amplified by the forces of technology, scale, and aggressive investing and competition,” said Ennèl van Eeden, global entertainment and media leader and partner, PwC Netherlands, regarding the key trends in the Global Entertainment & Media Outlook 2019–2023 study.Global Entertainment & Media Outlook 2019–2023 study.

“The implications for organisations are profound. As the borders separating former media silos erode, companies need to think more broadly about the areas and segments in which they operate. At the same time, all E&M players must take the need to ‘know your customer’ more seriously, and marketers need to allocate their time and attention to new types of content and platforms — influencers, live events, ads inside apps and more. Finally, companies must focus intently on their core capabilities and geographical markets, while continually scanning the horizon for new developments and regulations, and being agile in responding to technological developments such as 5G. Put simply: it’s time to get personal with consumers — or be left out of the conversation.”