A merry New Year for media?
It’s the time of year when lists are made – Christmas presents, food and wine for the festivities, New Year resolutions, and, on a more serious note, economic and business forecasts for the year ahead.
The UK has experienced its fair share of challenging times, and this looks unlikely to change with predictions of gloom rather than boom. The most recent economic data was described as disappointing and unwelcome, however not surprising or unexpected.
Slow growth is the “new normal”, and achieving parity the ambition for many. According to the Bank of England, the economy is unlikely to get back to pre-crisis times until 2015.
With the ongoing Eurocrisis, high unemployment (whilst it may have fallen, we have witnessed a shift to part-time and temporary work) and a lackluster GDP – 2013 looks at best bleak. Money markets are predicting inflation will continue to hover around the 3.5% mark (where it has been since the beginning of 2008), bank rates at 0.5%, and growth for 2013 of around 1%.
Shopping habits can give us an insight into the mood of the nation, and according to a recent Financial Times article there are two key trends that have emerged; the search for value, a response to the rising cost of living and the way we shop – which is migrating to online. Food trend forecasters (yes this job does exist) are talking up 2013 as focused on technology and big bold flavours – not dissimilar to the 2013 media landscape; technology driven and value seeking.
In 2005 there was no iPhone, no Twitter, no YouTube, and Facebook was restricted to universities only. Fast forward a decade to 2015 and it is predicted there will be 25 billion connected gadgets sold against a global population of 7 billion.
There is no escaping the fact that digital has weaved its way into the fabric of UK life. Devices are an intrinsic part of our daily routine, our shopping habits, and increasingly, our media consumption. How and when we consume media is evolving at an alarming pace – 60% of TVs sold in 2012 have broadband connection, 4G telephony will see five times the speed of 3G, and the number of tablets in UK households are likely to double to 10 million in 2013.
Ad revenues for 2012 are likely to grow by 2%, largely driven by digital, which shows no sign of abating. The year ahead is likely to be as much about (data) capture as engagement. Likes will be overtaken by being liked, but in an authentic and more truthful way.
To echo Sue Unerman’s sentiment, 2013 is the year of ‘truth telling’. The acceleration of social media, and its ability to give everyone a platform and a voice means the truth will come out.
Consumers are demanding more and for advertisers this means delivering on their brand promise. For media owners success lies in delivering accountable media opportunities.
So what for media in 2013? Current revenue forecasts are averaging 3% growth (ZenithOptimedia at 3.4%, Carat at 2.8% and Group M at 3.2%). There is universal agreement that 2013 will see two key trends – digital media revenues outpacing other channels, and with mobile and internet adoption, migration to online audiences.
Digital is anticipated to be the only UK media that will grow by double figures in the next 5 years with an average of 12% per year.
Measurable factual information will continue to develop greater targeting potential with communication more personal than ever seemed possible. Michael Lewis’ Moneyball is a prime example of the business potential inherent in digital and data.
Harnessing the value in statistical analysis, the Oakland athletics baseball team outsmarted the Yankees and their $125 million player investment with just $41 million. In the field of politics, Nate Silver used data to successfully predict the correct US electoral votes in 50 of the 50 states. Digital, data and analytics are set to transform how we operate.
However, whilst data is integral to a sustainable media economy we must not lose sight of creativity. As analytics guru Avinash Kaushik says, whilst numbers, hits, followers and likes are important we need to take into account behaviour, mindset and emotions. “HITS” alone (how idiots measure success) give us what he calls a “glorious datapuke”.
To quote Sir Mervyn King, “the road to recovery will be long and winding but there is good reason to suggest we are travelling in the right direction”. Media needs to learn from the world of start-ups, to roll with the punches and be ready to “pivot”.
This means a willingness to abandon “this is how we do it” to “this is what we need to do”. Twitter was not dreamt up as the £8 billion information network it is today; in its original incarnation “twttr” was a podcasting offering called Odeo.
In tough times, tough decisions must be made. Digital and data are definitely in the driving seat but we need talent and creativity to harness the potential.