Did young people just kill television?

Kennedy watching television 2018

Watching flight of Astronaut Shepard on television. Left to right: Vice President Lyndon Johnson, Arthur M. Schlesinger, Jr., Admiral Arleigh Burke, President Kennedy, Mrs. Kennedy. White House, Office of the President’s Secretary. Cecil W. Stoughton (1920–2008)

This article is brought to you thanks to the strategic cooperation of The European Sting with the World Economic Forum.

Author: Adam Jezard, Formative Content.

While previous reports of the death of traditional TV viewing have been greatly exaggerated, 2017 marked a major tipping point. Spending on online and digital advertising in the United States overtook broadcast and cable revenues for the first time ever.

The money seems to be following younger viewers, who are increasingly turning to social media, apps, gaming and on-demand TV. Marketers have even coined a term for the Millennial and Gen Y viewers who spurn traditional TV: “the Unreachables”.

GroupM, part of advertising giant WPP, predicts that, globally, time spent with online media will overtake linear TV viewing in 2018. Online will have a 38% share, TV 37%, and the balance will be spread primarily across print and radio.

Global Online Media Usage will surpass TV in 2018 Online advertising beats traditional TV for first time last year with $88B
Image: Interactive Advertising Bureau (IAB) 2017 annual report

A trend for youth

Internet advertising revenues in the US totalled $88 billion in 2017, an increase of 21.4% from a year earlier, according to the Interactive Advertising Bureau (IAB) 2017 annual report. Advertising on TV, meanwhile, fell to $70.1 billion, a 2.6% drop, for the same period.

Meanwhile, Nielsen, which reports on US TV viewing habits, said that 18-24-year-olds were watching under one hour and 49 minutes of traditional TV a day in the second quarter of 2017, a fall from two hours and 10 minutes a day the year before. This is part of a broader slide of 44% since 2012.

Older audiences are underpinning traditional TV. People aged 50-64 watched 39 hours 35 minutes a week, which is relatively flat over five years.

But those who were 65 and over viewed 48 hours and four minutes of traditional TV a week. While this is down by 1.2% from the year before, it marks an overall rise of 6% since 2012.

Reaching out to the ‘Unreachables’

Turning off the TV is gaining traction among younger folk, an Omnicom Media Group study agreed. This found 47% in the 22-45 age bracket were no longer hooked by the unblinking eye in the corner of the room.

Omnicom found that a third of households aged under-35 did not have a cable or satellite subscription, while in 2016 the smartphone replaced the TV as the device most watched by Millennials.

While younger audiences are “blending” – using apps, social media platforms, playing games – they are still watching TV, just in a different way: Omnicom says that 73% of US Millennials use online streaming services, with Netflix and Amazon the market leaders.

Distributors are already responding to this fast-changing environment by seeking to combine and own more content, as recent mergers and acquisitions activity in the media sector shows. AT&T’s bid for Time Warner, Comcast and Disney’s vying for Fox, and T-Mobile’s planned merger with Sprint are some of the more headline-grabbing attempts.

Ad-free zones?

But how much studios will charge and whether new streaming services will carry advertising – and how much and for whom – are questions open to debate. Netflix and Amazon have taught a generation that ad-free television for a low-price subscription is the norm.

Farid Ben Amor, who is part of the World Economic Forum’s Future of Information and Entertainment Initiative, said: “Between streaming services and traditional TV, video remains the predominant way millennials spend leisure time, but conventional commercials are far less tolerated among this group. Brands and programmers need to collaboratively create new ways for digital advertising to reach this audience if they are to sustain the financing necessary for content at today’s production quality. “

There are also questions over whether regulators in the US and beyond will stand for what some have called a “Balkanization” of content. The Department of Justice at the end of April stepped in to block the AT&T-Time Warner deal, a move now the subject of a legal challenge.

The DoJ has argued the merger would mean substantially less competition and higher prices for consumers unless some of the subsidiary content companies or linear networks were spun-out. In response, the companies said the government must prove the merger “will likely (not potentially or possibly) lessen competition substantially, in a video marketplace that is experiencing revolutionary, unstoppable transformation and growth in competition at all levels”.

Who has the money?

One further point about the separation of ad spend on media consumed by younger and older viewers is worth considering: according to Omnicom, the US Millennial market is worth $1.3 trillion, which the marketing company calls “staggering”.

However, this is dwarfed by the spending power of older generations. Marketing Charts points out: “Baby Boomers have the highest average monthly spend per [US] household, of $765. That figure is about 50% higher than Millennials’ average of $508.”

It adds: “These figures bring to mind a seminal statistic released by Nielsen in 2012: that [by 2017], Boomers would control 70% of disposable income in the US.”

So, while marketers are keen to win over younger generations of consumers, do they risk ignoring the grey dollar at their peril?

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Featured Stings

Diana in Vietnam

Did young people just kill television?

Why exchange programs are essential for the medical students of the 21st century

Qualcomm to be the next target of EU antitrust regulators? China might be the answer

The gender gap of medicine in 2018

Movius @ MWC14: Discussing novel Communications Applications over a “CAFÉ”

Why impoverishment and social exclusion grow in the EU; the affluent north also suffers

The West cannot ignore Russia; dazed Germany sitting on the fence

The energy industry is changing. Are governments switched on?

Draghi cuts the Gordian knot of the Banking Union

Building cybersecurity capacity through benchmarking: the Global Cybersecurity Index

Brexit: The Conservative Party drives the UK and Europe to a perilous road

To end deforestation, we must protect community land rights

Consumers suffer three defeats

EU and Amazon cut deal to end antitrust investigation over e-books deals

American negotiators can’t pay for their trip to Brussels, EU-US trade agreement freezes

Professional practices of primary health care for Brazilian health and gender inequality

EU security and defence industry prepares positions for ‘producers’ and ‘customers’

EU Commission retracts on the Chinese solar panel case

UN humanitarian coordinator condemns Central African Republic hospital attack as ‘inhuman and unworthy’

The Ukrainian crisis to destabilize Europe and the world for a long time

AIESEC @ European Business Summit 2014: European Youth, Change Now Patiently

Eurozone: Retail sales betray economic frailty

Theresa May in search of a magic plan to invoke Article 50 and start Brexit negotiations now

My Mothers

EU continues targeting on Chinese steel imports instead of the revival of its own economy

Is Eurozone heading for disinflation?

Around 2.5 billion more people will be living in cities by 2050, projects new UN report

Counting unemployment in the EU: The real rate comes to anything between 16.1% and 20.6%

Is there a way out of the next financial crisis? Can more printed money or austerity save us all?

The key takeaways of G7 Summit in Canada

Does the West play the Syrian game in Egypt?

“Will TTIP solve the massive EU-US unemployment? Absolutely not!” A revealing Sting Exclusive with Tim Bennett from the Transatlantic Business Council

Is a full course lunch, a new Commissioner and 2 million anti-TTIP citizens what you would call a “Fresh Start”?

€5 billion of EU energy efficiency project money spent on “comfort”

Eurozone economy desperately needs internally driven growth

Commission facilitates the activities of ‘merchants of labour’

The banks first to benefit from the new euro trillion ECB plans to print

What fighting malaria can teach us about linking purpose and business

Google and Apple suddenly realise that doing business in EU is tough?

Vendor Pulse – 2000

The European Parliament fails to really restrict the rating agencies

A Sting Exclusive: EU Commission’s Vice President Šefčovič accentuates the importance of innovation to EU’s Energy Union

New skills needed for medical students in Industry 4.0

Trump’s pounding of Iran less harsh than expected, leaves arrangement open

FIAT Chrysler: from Geneva Motor show to the World, and back

Central Africa Republic: Violence drives thousands of refugees into neighbouring DR Congo, says UN agency

Will Cameron succeed in keeping UK inside the EU and reverse the present economic downturn?

Greece: The new government of Alexis Tsipras shows its colors

Politics still matter in the US but not in Europe

Yellen and Draghi tell Trump and markets not to expedite the next crisis

GSMA announces new keynote speakers for 2018 Mobile World Congress

Ecofin: ‘The Friday battle’ for the banking union

Commission caps charges on card and Internet payments and enforces competition

China and UK relations post Brexit as EU addresses Chinese takeovers

Eurostat overturns Commission’s assessment of the economy

China’s New Normal and Its Relevance to the EU

Trump systematically upsets global order and trade: Where does this end?

Eurozone and Britain heading in different directions

Is the ECB enforcing the will of the big Eurozone member states on the small? Can the euro area live with that?

More Stings?

Speak your Mind Here

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

w

Connecting to %s