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Digital media trends in both entertainment and advertising and the new habits of Generation Z.

Updated: Feb 22, 2022

How can media, brand and entertainment companies develop lasting relationships with consumers as the media landscape radially changes?

After a historical and challenging few years, the world has become increasing reliant on media for entertainment, information and social interaction. The pandemic has certainly accelerated these media trends and altered entertainment-related behaviours, leaving many wondering what trends will stick after the crisis and what implications that has for the media and entertainment (M&E) business.

The competition for audience attention has grown fierce amongst the increasing list of streaming services, as well as unfathomable amounts of social content. People are enjoying numerous subscriptions to both paid and free streaming video and music channels. Video games have seen an exponential boom and the vast majority have turned to social media for both entertainment and news.

As Media and entertainment companies grapple for consumers, the next wave of disruption comes not in the form of an epidemic, but lies with the dominant demographic that is Generation Z.

Gen Z’s leading sources for preferred viewing comes in the form of video games, streaming music and social media, rather than just watching TV and movies.

Keeping consumer attention is becoming increasingly difficult. With omni-channel viewing now so prevalent (social media on your phone, streaming services on your TV or smart device) everyone is looking to ‘court the consumer’. In the world of ever growing choice where the consumer is ‘the key to success’, understanding their behaviours, how they differ and how Media and Entertainment, along with branded companies, can best position themselves as long-term partners is vital.

A World Where Choice Is Key

In a world led by freedom of choice most dominant demographics said they use social media, have at least one paid streaming video service, and play video games in some capacity.

With an overwhelming amount of entertainment options vying for consumers attention, the 15th edition of Deloitte’s Digital Media Trends survey conducted a study to understand their favourite ways to consume Media. “For our respondents, watching TV and movies at home continued to be the overall favourite, with 57% ranking it in their top three (out of 16 entertainment activities). This was the top choice for Millennials, Generation X, and Boomers (figure 2). When we looked at Generation Z, however, there were distinct differences. Playing video games was their favorite activity (26%), followed by listening to music (14%), browsing the internet (12%), and engaging on social platforms (11%). Only 10% of Generation Z said that watching TV or movies at home was their favourite form of entertainment.”

With Gen Z preferences for gaming and social media persisting over time, the dominant position that video entertainment has always held, could well be challenged.

If this is the case, Media companies should be prepared to evolve and diversify their approach, starting with the use of gaming.

Generation Z Could Reshape The Entertainment Landscape

Knowing that Gen Z has a vastly different entertainment reference, often opting for video games and music over watching TV and film, acknowledgement of this is vital for the survival of branded advertisement and live action content.

Gen Z is starting to become influential over the behaviours of Millennial and Gen X consumers - and of course the younger generations that follow.

Video games were already becoming a dominate media before the pandemic, but we saw this amplified due to social distancing orders. “We found that 87% of Generation Z, 83% of Millennials, and 79% of Generation X said they play video games on devices such as smartphones, gaming consoles, or computers at least weekly. Many are playing daily to fill idle time, connect with friends, compete with opponents, and escape into stories. Most Generation Z, Millennials, and Generation X respondents said that during the pandemic, video games helped them stay connected to other people and get through difficult times. More than half of Millennials and Generation X said that video games have taken away time from other entertainment activities.”

Media companies and advertisers may still be standard video-first, but younger generations may not be. To understand this potential shift, providers can work through these questions:

- How do we better understand the nuances across different media.

- Can we leverage these into our current structure to reach younger audiences, helping to expand our brand and gain more attention.

- Are we strategising to address the impact of gaming, streaming music and social Media in our current plan?

The Game Between Value And Trust

Personalised and targeted advertising is demanding more data from consumers than ever before. The question, “Is data more valuable than Gold?” is an easy answer in todays digital facing world. But how do the consumers really feel about their data being collected from all angles. Although consumers aren’t really changing their behaviours, they do want more agency, protection, and oversight in the data economy.

82% agreeing they should have the ability to view and delete any data companies collect.

75% agreeing that platforms and service providers are responsible for protecting their data.

45% being willing to pay access to a platform that didn’t collect personal data.

77% believing the government should do more to regulate data collection and use.

With Data protection so prevalent, yet the value of data so vital to the success of advertising and M&E, ways to capture data unobtrusively will become ever more important across these sectors. Done right, M&E, advertising and brand businesses can differentiate themselves by offering strong data protections that empower users, deliver greater value, and create better user experiences. Interactivity can provide all of these areas for a game facing future.

ADVERTISING: Personalised Engagement

Advertising underlies and supports the ecosystem around all entertainment and social media, with advertisers constantly striving to capture their attention, turning engagement into ROI. With a world now bombarded with content, the skip and scrolling mentally of todays consumers is becoming the medias answer to an epidemic. Although all global advertising revenue was hit in 2020, digital advertising grew by 5.7% and continues to do so.

As advertising further develops in the digital landscape, providers need to consider how ad-related content needs to drive consumers preferences and expectations around personalisation and privacy.

Without the bespoke experience the digitally savvy consumer is now so used to, linear and passive brand adverts fall victim to the 76% skip rate across standard advertising.

Brands that lead with a digital strategy in regards to advertising see the ability to personalise as a key differentiator to meet the needs of their consumers. But there is a major challenge brands and advertisers face: How to balance personalised ads with the use of personal information.

On any given social platform, 62% of Gen Z and 72% of Millennials would rather see a personalised ad linked to their preferences and likes rather than a generic one. However only 40% said they would be willing to provide personal data to receive this due to the lack of trust or lack of knowledge as to how their personal information is leveraged.

What is the solution for delivering personalised, bespoke ads whilst protecting consumers data? Interactive advertising. Interactive advertising allows the consumer to engage with the areas of the brand/advert that is more relevant to their likes. It captures data unobtrusively, delivering value to both the consumer and the brand. It interlinks standard video with gamification appealing to both traditionalist and game-centric viewers. With this way of advertising increasing customer engagement, increasing brand and marketers ROIs, all whilst avoiding cookies, it's easy to see why game changing brands are opting for this option of video content.

The key is for brands, entertainment providers, digital platforms, and advertisers to understand the nuances between consumer and how they vary across media types and generations. The days of standard video advertising may have had its day with the current influential demographics.

Navigating This New Space And The Social Relationship With Todays Consumers.

Facing a fierce world of limitless content and competition is ever looming overs M&E, advertising and branded businesses. A laser focus on how they can help provide a more meaningful, valuable and personal experience for their consumer is imperative, gaining a deeper understanding of their costumer. By learning how to navigate between content and ad-tolerance whilst combining the use of gaming, video and music, these businesses will win in the evolution of consumerism. Those that stay rooted in standard video will slowly be edged out and loose the battle. The key is an understanding of the new multifaceted entertainment habits, led predominately by Generation Z. Businesses should be investing in the right data and how to personalise branded content and entertainment across multiple channels. In this rapidly changing landscape, from the Metaverse to interactive content, developing trust with their consumers will help media focused strategies to be more prepared today for what might happen tomorrow.

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