There’s no sugar-coating it: the media and marketing industry has been hit hard by the COVID-19 pandemic.
Cancellations of large events and outdoor gatherings, coupled with worldwide orders to stay at home, have meant a dramatic fall in advertising spend which has caused a ripple effect across the sector.
But it’s not all doom and gloom: esports, marketing tools as well as streaming and digital sales are all seeing explosive growth during this period. It’s a fascinating time to work in the media and marketing industry, and there are several emerging trends that will be here to stay long after the COVID-19 crisis has passed.
Content creation goes virtual
Pay TV has been badly impacted by the crisis: with sports fixtures cancelled and production of future content stalled, it’s no surprise that advertising revenue has all but dried up across the sector. But there are still opportunities for the media and marketing industry. With many spending more time at home, gaming, streaming services and podcasts have all exploded. Suddenly, individual content creators on emerging media platforms like TikTok and Twitch have dramatically expanded audiences, opening up new possibilities for brands and media players to engage their audiences in new ways.
Behind the scenes, technology is playing a critical role in keeping the lights on for the media and entertainment industry. Record demand will see streaming services like Netflix, Disney+, HBO Max and others invest even more in software to help them manage their network traffic effectively. Compression from HD to standard definition is also becoming more prevalent to manage bandwidth. Digital marketers need to consider these trends in the wider media landscape as they look to adapt their advertising and marketing budgets to the new reality.
Winds of change in advertising
The advertising industry has clearly been hard-hit by Covid-19. Some sectors such as out-of-home advertising are looking at a 60-70% reduction in revenue, while shares in newspaper groups have tumbled due to falling advertising spend. However, other areas of advertising are flourishing. Ad spend on gaming is by 25%, while other areas like retail and social media are also showing strong growth.
Covid-19 is forcing global behaviour change on a massive scale, and as such we’re seeing long-term trends in marketing speed up before our very eyes. High growth areas such as esports and streaming are picking up even more momentum, while areas that were already on shaky foundations risk being toppled completely.
“Never waste a good crisis” as the saying goes: these trends present the industry with opportunity as well as adversity. Consumers are radically changing how they spend their time with media as well as the channels and technologies they use, and many of these changes will become long-lasting or even permanent. The time is now to adapt and prepare for this future.
A more connected industry
In such trying times, there’s no need for media and marketing businesses to ‘go it alone’. Indeed, fostering partnerships and ecosystems within the industry will be a critical way of ensuring survival. As consumers are faced with more and more media choice, it will become more challenging for businesses to achieve cut through and acquire new customers. Media players that can form an ecosystem around their core business can overcome this, offering products and services to consumers that diversify the company’s business models and revenue streams, putting the business on firmer ground when unexpected shocks arise.
The Financial Times is a great example of this approach. The newspaper has a history if being an innovator in digital media, being one of the first news organisations to put up a paywall around its content, thereby ensuring a healthy balance sheet that many of its peers do not enjoy. But the paper hasn’t stopped there: it has launched several other ventures, including consulting, events and educational programs. These efforts complement each other as well as the core news business and leave the company in a strong position in the market.
No matter your business, if you work in media and marketing your business model and core assumptions will have been put under strain in recent months. The actions taken now will have a lasting impact, and technology has a key role to play. New media is providing much needed growth for marketing and advertising, while changing consumer behaviours are putting data and technology at the heart of the conversation. I am optimistic that the industry will find a way through and adjust to the new world on the other side of this crisis.