LONDON, Jan. 16, 2019 /PRNewswire/ -- Media and
entertainment companies must adopt a multigeneration strategy and
challenge perceptions around the behaviors of older generations, or
risk conceding huge growth potential. This is according to EY
study, Ten opportunities and threats for media and entertainment
companies | 2019, which shortlists the most pertinent risks and
opportunities facing the industry in the next 12 months.
In recent years, the industry has placed younger generations at
the heart of content and channel strategies. But while Gen Z and
millennials are regarded as digital natives, baby boomers (born
1946-1964) typically have more disposable income and are becoming
increasingly adept in how they consume content and embrace
technology. EY research1 indicates that boomers are more
loyal than younger generations, and with people aged 65 and older
set to exceed the number of children under the age of five by
20202, this demographic offers an emerging growth
opportunity. The report states that companies must now take steps
to better understand boomers' unique preferences.
John Harrison, EY Global Media
& Entertainment Leader, says:
"As a demographic group, the older generation is simply too big
to ignore and will only become more influential over time as they
ascend the technology ladder. With competition intensifying, to get
closer to the customer, media and entertainment companies must now
broaden their focus beyond younger demographics if they are to
succeed in an increasingly complex landscape. A data-driven
approach will be essential for companies to understand how older
generations are adopting technology, and to help facilitate the
development of personalized experiences across the right channels –
thereby unlocking huge opportunities for growth."
Striving to compete with digital natives
Looking beyond age demographics, the report also cites
"obsessing about the customer" as one of the top ten themes for
2019. While media companies are continually reinventing products to
compete with digital natives, complexity breeds inconsistency that
can deliver a poor customer experience. In particular, many
companies lack the infrastructure to gather relevant information
from multiple channels and feed it back into their ecosystem. To
mitigate this, the report states that companies must deploy
technology more like digital natives to enable better customer
experiences.
Another key theme, "re-calibrate for growth," indicates that one
way to achieve this may be through investing in new digital
ventures. With many of the leading digitally native companies
turning traditional business models on their heads, the report
highlights that in order to keep pace, radical change is required
around how more traditional media companies raise, invest and
optimize capital. Indeed, nearly a quarter (23%) of media and
entertainment respondents to the 19th EY Global Capital
Confidence Barometer indicate that they are now reviewing their
portfolios every quarter – up from 1% in April 2018.
With such rapid advancements in technology, and with media
companies amassing huge volumes of personal data, cybersecurity
also features as a critical threat facing the sector. The report
highlights how the Internet of Things and a growing number of
connected ecosystems have multiplied the potential threat level in
recent years. In response, companies need to take steps to devise a
multilayered cybersecurity strategy, with a particular focus around
brand-related assets.
Harrison says: "We have known for some time that media and
entertainment companies are at the center of disruption, driven by
the inception of new technologies and changing consumer attitudes.
As ecosystems continue to shift at an even greater pace across the
industry, the imperative to act is now as companies place their
bets on new technologies, business models and mergers and
acquisitions to improve how they interact with their customers. But
in doing so, they must not overlook the urgency to build higher
levels of cyber resilience across what is becoming a much wider
content delivery chain."
A perfect storm of geopolitical trends
The report further identifies unprecedented disruption across
the tax landscape as presenting both a huge opportunity and threat
to the industry. A range of macro trends, including Brexit, trade
disputes and a global drive toward increased transparency, are
playing into a deepening sense of uncertainty. Meanwhile, the
biggest revision to the US corporate tax code in 30 years could
mean greater upside for companies that host their intellectual
property in the US. Media companies must build digital tax
functions that are sufficiently agile to respond to this
turbulence.
Other opportunities and threats cited in the report include
intelligent automation, which can help companies achieve tangible
benefits on both the bottom and top lines; the prospects of
building direct to consumer business models; and the intensifying
battle for content.
Notes to Editors
About EY
EY is a global leader in assurance, tax, transaction and
advisory services. The insights and quality services we deliver
help build trust and confidence in the capital markets and in
economies the world over. We develop outstanding leaders who team
to deliver on our promises to all of our stakeholders. In so doing,
we play a critical role in building a better working world for our
people, for our clients and for our communities.
EY refers to the global organization, and may refer to one or
more, of the member firms of Ernst & Young Global Limited, each
of which is a separate legal entity. Ernst & Young Global
Limited, a UK company limited by guarantee, does not provide
services to clients. For more information about our organization,
please visit ey.com.
This news release has been issued by EYGM Limited, a member of
the global EY organization that also does not provide any services
to clients.
How EY's Global Media & Entertainment Sector can help
your business
In an industry synonymous with creativity and innovation, the
bar for business excellence is set high. You need to embrace new
technology, develop new distribution models and satisfy the demands
of a voracious and outspoken consumer. At the same time, it's
important to manage costs, exceed stakeholder expectations and
comply with new regulations. There's always another challenge just
around the corner. EY's Global Media & Entertainment Sector can
help. We bring together a high-performance, worldwide team of media
and entertainment professionals with deep technical experience in
providing assurance, tax, transaction and advisory services to the
industry's leaders. Our network of professionals collaborates and
shares knowledge around the world to deliver exceptional client
service, leveraging our leading market share position to provide
you with actionable information, quickly and reliably.
About the report
The media and entertainment industry is squaring up to the
challenges of shifting customer demands, technology innovation,
regulatory and policy upheaval, and a strategic reshaping of the
competitive landscape. In the latest look at the biggest
opportunities and threats facing the industry, EY Global Media
& Entertainment Sector team highlights the priorities for
industry leaders and how they can respond.
Michael Curtis
EY Global Media Relations
+44 (0)207 980 0454
michael.curtis@uk.ey.com
____________________________
1 EY report, As easy as X, Y, Z: Exploring
generational differences and attitudes to technology, media and
telecommunications
2 World Health Organization report, Ageing and
health, February 2018,
http://www.who.int/news-room/fact-sheets/detail/ageing-and-health
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SOURCE EY