Stephen Poehlein, Director Advisory-Media & Entertainment, PwC
Fundamental changes are continuing to be felt by content creators and distributors. From the transition to digital, global/distributed production and post production, new distribution models, to the move to “everything as a service,” both the business and technology must adapt to new pressures. Traditional appointment TV is fading as new ways of discovering and viewing content continue to expand. Filmed entertainment is increasingly event driven with the exploitation of more franchise properties targeting a rabid fan-base. User-generated content is growing as well, competing for an increasingly fragmented audience.
Out of all of the fundamental changes impacting the entertainment industry, the most important change is that of the consumer. The appetite for content has never been greater and the choices for how and where to find it are growing every day. Consumer behavior is changing as well. Many consumers now rely on word of mouth on social media to discover new content. Analytics driven recommendations promote content based on user viewing habits. Traditional methods of measuring total audience and viewing behaviors are no longer enough to provide a comprehensive view to the success of a property.
Millennials are changing the paradigm even further, spending more time viewing content on mobile devices and in smaller chunks. Having grown up in a video game culture, they are accustomed to being rewarded for the investment of their time. They also have less patience for generic content and advertisements.
Brand loyalty, when it comes to entertainment, is fickle. In the not too distant past, we went to every movie by a certain studio or filmmaker, watched one TV channel because of its lineup, or listened to one record label because of its stable of artists. For most creative content the consumer has no idea (nor cares) what company produces it, what channel it’s on or how it’s delivered. They just want it when, where, and how they want it. Franchise or the product itself, in most cases, is becoming more important than brand.
We’re loyal to an airline or hotel because they reward our patronage with something tangible.
Whether its points that add up to free products or an upgraded experience, we like to feel that we’re a valued customer. We’re also loyal to brands that provide a unique experience, but even those tend to revolve around a franchise.
The entertainment industry is at a major pivot point, moving from a generic, one-way content publisher and instead toward a meaningful dialog to deliver more personalized content experience
These challenges need to be addressed holistically. Viewing behavior needs to be understood across all mediums, rewards can’t be given if there is no visibility as to who is consuming a piece of content. Identifying brand detractors or advocates all require a proactive and integrated strategy. Negative sentiment toward a trailer or other promotional piece spreads much faster than positive comments. The longer it takes a company to address an issue allows it to proliferate and will sometimes irreparably damage a product.
The opportunity now afforded content companies arises from these very challenges. Seldom before have entertainment companies had a direct relationship with their customers. They were one step removed through distributors, retailers and licensees. With direct channels of content, ecommerce sites, and partnerships with over the top providers, companies can more easily have a direct and personal relationship with their customers and fans. This requires an extensive social media strategy that moves beyond social listening and into social engagement.
Companies now have the opportunity to engage in direct dialog with the consumers of their content, to understand what motivates them to buy a ticket, tune in, or download their products. Once this dialog has started, it can expand into a brand advocacy relationship, rewarding fans for their positive comments and behavior. Loyalty rewards rate as a top incentive millennials look for in exchange for sharing their personal information and a majority are willing to promote brands for some kind of reward. There are numerous ways to incentivize and reward advocates with both digital and physical goods.
To facilitate this new customer relationship, technology must partner with the business in several key areas;
• Customer Relationship Management (CRM) has to be thought of across silos with Integrated Analytics so the business can connect the dots between lines of business. This “one view” of a customer can help generate insights that lead to increased revenue.
• A Social Media Engagement Platform can provide real-time understanding of the health of a franchise or brand and surface both positive and negative issues so they can be addressed quickly.
• A Loyalty Program or gamification strategy to create brand advocates and incentivize fans to consume more products. This stored value system should extend across lines of business to all aspects and over the lifespan of a franchise.
• A Big Data and Analytics capability to draw true value from the information collected. The ability to correlate cause and effect from product related events and provide that information to the business in a timely manner so that action can be taken.
The entertainment industry is at a major pivot point, moving from a generic, one-way content publisher and instead toward a meaningful dialog to deliver more personalized content experience that creates better value for customers. New tools allow more direct engagement with consumers that can allow companies to deliver timely, relevant, and personalized content experiences that will likely become a true differentiation in the marketplace.