Over the past decade, the media and entertainment industry has been at the cusp of rapid transformation. Digital media emerged as an alternative distribution medium, taking center stage across all sub-sectors like print, films, advertising, gaming, animation, radio and music. It has also proved to be a core revenue generation platform, compelling several media companies to adopt digital strategies to survive the fiercely competitive market.
Coupled with that is the ongoing video streaming war between giant players like Amazon and Netflix, and the unpredictability that it brings. Netflix lost USD 17 billion in a single day last year! With the lines between paid, owned, and earned media getting blurred, more players are expected to jump in streaming; and the market is expected to reach USD 6,709.4 billion by 2030.
Interestingly, all of this has vested more power in the hands of the customer and prioritising customer retention will be the most significant trend for 2020. Companies looking to increase their profits are turning to innovative tactics, including AI, AR/VR, and phygital to keep their customers engaged. Here’s a look at some of those trends expected to transform the media and entertainment industry in 2020 and beyond:
AI for Personalization and as a Service
One of the most transformative tech solutions in the past few years, AI has been used in numerous ways to improve customer experience and streamline business operations. This will continue in 2020 where media companies will continue working alongside AIs for personalized content recommendations and effective advertisements.
Given the rising customer expectations, and demand for personalized content in recent years, media enterprises are increasingly under pressure from a wide range of competitors. Top players have moved past from just suggesting the content customers might like to creating content customized according to their choices.
Reports show that 40% of Millennials and Gen-Z’ers are willing to pay for personalization done well.
Using AI, and data based on user behavior patterns, media companies are able to personalize what ads to show to garner user interests. While the scope of this was for larger groups in the past, starting 2020 this will zero in for more specific buyer personas, and eventually be targeted for individuals!
Forbes is using an AI bot named Bertie, which recommends article topics for contributors based on their previous output, headlines based on the sentiment of their pieces, and images too.
Leveraging AI makes the process of creating new content more efficient for businesses, publications and online creators. Creation of new ads, movie trailers can be done, with AI streamlining all pre- and post-production processes. Big data and machine learning are two other technologies aiding AI in its mission of bringing enterprises closer to customers.
Apart from that, 2020 will also see a growing pool of providers like Amazon, Google and Microsoft, start offering more tailored applications and services for specific organizational tasks. Therefore designing and deploying their own AI-based systems will also remain an expensive proposition for most media companies this year.
Virtual and Augmented Realities
In 2017, The Global Entertainment and Media outlook forecast predicted that by 2020, VR content revenue would increase to $5 billion, making it one of the hottest trends in the media and entertainment industry. And even though the use of AR and VR in the media and entertainment is relatively new, enterprises are rapidly adopting these alternate realities to meet the growing customer demands.
VR has an array of applicability in the entertainment industry. In gaming, 3-D games are developed with the help of VR and biosensors—for the positioning of players. It also helps in creating virtual museums, galleries, theatre, and theme parks.
AR has been trending in gaming; we all know how much popularity Pokémon GO gained in no time.
Disney’s app—Play Disney Parks—also enables visitors to play games based on Disney themes while standing in the queues. Besides that, AR enables real-time 360° coverage in news reporting in order to give a satisfying user experience.
The coming year holds very exciting opportunities for AR and VR, bringing the possibilities of allowing a person to view three-dimensional images, that appear as life-sized to them.
Online Streaming and Smart Media
Apart from leading players like Netflix and Amazon, several others like Apple, Disney, HBO Max and WarnerMedia are joining the streaming domain, making it even more complex. There’s an increasing competition, coupled with the need to meet customer expectations. However on the bright side, the craze of Subscription Video On Demand (SVOD) is also rising.
Enterprises are leaving no stone unturned to have an edge over others, leveraging technologies like AI, machine learning, alternate realities to up their game. 5G is another trend in demand because of its high connectivity and faster data transfer, that enables a smooth, seamless user experience for VR. It also obviates the need for wifi network for video streaming.
Then there’s also the need to create smart media, content that users can interact with.
Netflix came up with Black Mirror: Bandersnatch last year, that received wide appreciation because it enabled users to interact and make decisions to influence the direction of the further story.
2020 opens the door for more such interactive content by the media enterprises that not only entertain viewers but also influence it with their decision making.
Focus on the Enterprise
While media enterprises are rapidly focusing on the tech side of the digital transformation, they often end up spending more than their profits, particularly, to stay ahead of the market competition. While that might be important up to an extent, there’s also the other side that needs more attention. That you need to start focusing on building intelligent enterprises—not just cool and exciting media arms.
2020 is the time when you should start making investments in tools and technology that ensure higher efficiencies, lower spending and more efficient work processes. Processes that empower great publishing experiences for your editors should be on your to-do list. Continuous improvements should become a part of your strategy to ensure that the ROI from your tech investments are measurable and ideally increasing.
Digital transformation in media and entertainment has brought tremendous innovation to the consumer, and it is important that you apply the same effort to the back office to make sure your operations can support growth as well as scale profitably.
Decentralized Distribution and Data Privacy
Last few years saw an unprecedented rise in the number of fake news and videos, while also risking the misuse of customer data. In 2020, media companies are expected to exercise more control over their data, use AI algorithms to detect and block deepfakes, as well as trace their creators to make data privacy and security a top priority.
Deloitte’s most recent Digital Media Trends Survey shows that consumers still fear identity theft, financial loss, and unauthorized use of sensitive data—largely because many have experienced these threats directly. They are increasingly demanding the same level of control over their personal data that they enjoy in crafting their home entertainment experience.
Blockchain has the potential to completely transform the industry, as it eliminates the need for an intermediary from entertainment and media distribution. With direct access to the consumers, media companies are in a much better place to distribute original content, while also ensuring transparency and traceability.
Apart from these, there are a few other trends that would have a significant impact on the media and entertainment industry. Wide adoption of voice media, re-innovating how radio is used, leveraging AI based advertisements to influence decisions are some prominent ones.
Overall this year is going to be crucial for media-marketers, and to survive the rapidly changing market conditions, they need to focus both on what they deliver, and how they deliver it. Media companies need to to regroup and get serious about using technology not only to cater to their fan bases, but to make smarter connections while driving greater profitability into the business.
Looking to enable digital transformations within your media enterprise? Drop us a line, and our team will get in touch.
Or if are you looking to adopt digital transformation practices for your travel enterprise, here's a round up of 2020's biggest trends for travel.