“With the entertainment and media (E&M) market showing slower growth, for companies and brands to be successful they will need to be much closer to the consumer,” adds Elenor Jensen, associate director at PwC.
Together with Charles Stuart, associate director in entertainment and media practice, Jensen presented PwC’s Entertainment and Media Outlook: 2017-2021 (Outlook) in Randburg recently, which covers five years of historical data and forecast data on consumer or end-user spending and advertiser spending across five countries and fourteen segments.
Even during a period of digital disruption worldwide, there are a couple of realities that still endure and the most valuable constituents within the E&M industry remain these active, passionate and loyal fans, explains Stuart.
“While they have been empowered by technology which has now given them more choice, convenience and control than ever before, they still reward their favourite brands with an increased share, and a disproportionate share, of their time and spend.” This is because these brands provide them with a unique emotional connectivity, attachment and affinity in a world of massive media supply.
Jensen believes that business that will do well will be fan-focused “Or as we like to call it 'fan-centric'. They will have consumers that are both committed, engaged and that spend more per capita." What makes this model great is that fans of your business will help you recruit tomorrow's fans.
Therefore, as the industry transitions to a direct consumer world, what companies need to realise is that the companies that will be successful in that space are companies that fully embrace the fan-centric approach to their business and to the way that they operate.
Those are the businesses that will emerge as new leaders. “Making this transformation will require significant change and significant investment. But for the companies that make the fan the centre of everything that they do, the rewards will be substantial,” says Stuart
For a business to achieve this they need to create an experience that their consumer wants. That’s the first thing, says Jensen. “The second is to align your cost structure. Thirdly, you need to organise your operations so that you are lean and fit for growth. You don't just want profitable growth, you want sustainable growth. The last element is distribution.”
The biggest thing that we should be focusing on as business leaders is we should see where the fans naturally migrate and that will show us and identify new revenue streams she says.
“You will know when you are succeeding when you see interaction with your fans and observe communities popping up with a shared interest or passion, similar to the current trend seen with popular TV series Game of Thrones,” she says.
Winning in the E&M market will be all about making the right choices. While this may seem obvious, Jensen says it’s not. “It's about making the right choice between what consumers want on the one hand, and what technology can enable, and then to create business models and data systems to energise and amplify and, most importantly, monetise these choices."
While digital technology has brought the consumer much closer, this enables a larger degree of consumer choice and consumer control than ever before. This has led to a landscape of increased competition. "There are so many experiences that users can choose from. A company will not survive if it disproportionately caters for casual eyeballs, infrequent users or low-value audiences."
