In 2014, 49% of media was consumed on digital and just 4% on print. That shift in consumption has not only altered the advertising model, it has changed how media companies produce and distribute their content. L2 research fellow Steve Youngwood spoke about the new media consumption habits at L2’s Media (R)evolution clinic. Here are five takeaways from his talk:
1) Old media is trying to be new media, and vice versa. It’s no surprise that brands like the New York Times are looking at new ways to reach a millennial audience through digital platforms, but new media companies are trying to enter old media formats as well. For example, Vice continued to air on HBO after getting a $250 million investment from A&E. Netflix won five Emmy awards in 2014. Why? Television is profitable and accounts for more social media shares than any other platform.
3) Yet, there is room for catch up. For example, 23% of consumers’ time is spent on mobile ads, compared to 8% of ad spend.
4) Publishers who have great technology and content win. Consumers expect personalized content on-demand and on mobile, on all platforms, low-priced and ad-free. At the same time, advertisers want targeted numbers, the ability to measure reach, context for their ads, and a performance-based payment plan. In this competitive environment media companies need a strong tech arm in addition to good content. Google, Netflix, Pandora, Vice, Hulu, Spotify, Facebook, and YouTube have met these new expectations.
5) Old media is going luxury – and only certain brands can afford to. The value of a New York Times reader is $52 versus $5.7 for a Buzzfeed reader. Because of its well-defined brand, the New York Times has the highest social share of voice of all newspapers.
The future of media leads to a bifurcated class system where only luxury brands, mass market, and one-percenters can survive. The middle class will struggle.
For more insights on the new media landscape, look out for our upcoming media study.