The music industry in Europe has had a traumatic time, losing more than 31% of its revenue in the past five years to piracy. Given the increasing digitalization of content in the music, video, gaming, and newspaper industries, our recently published Forrester Research Online Paid Content Forecast, 2012 To 2017 (EU-7) maps content’s evolution from an audience, payer, and revenue perspective for each of these categories and for each of seven European countries. Here are some high-level results for the four categories:
Video.Video is the fastest-growing digital content category; we forecast that more than 90% of the online population will regularly watch online video by 2017. Online video audience penetrations will rise significantly as video on demand, pay per view, and catchup TV become mainstream. And with pay-TV penetrations in the EU-7 nations considerably lower than in the US, there’s more scope for paid online video to grow.
This week the news broke that Newsweek, one of the most recognized magazine brands in the world, will cease publishing its print edition after nearly 80 years and go all digital in 2013. The news got quite a bit of attention globally — it even made it into the printed edition of a Dutch newspaper. Of course, this didn’t come as a complete surprise, and Forrester has published enough about digital disruption and the media meltdown to know that newspapers and magazines have to change their strategy.
But the news got me wondering to what extent consumers use their digital devices for media consumption at this moment. Forrester’s North American Technographics® Media And Advertising Online Benchmark Survey, Q3 2012 (US) shows that about one-fifth of US online adults consume magazine content digitally, meaning they visit magazine websites or read digital publications.
This is lower than for newspapers, where about one-third of the US online population reads newspapers digitally — and 14% digital only (compared with 5% for magazines). Those who read digital magazines only are far more likely to be male, the average age skews younger than 35 years old, and only one-quarter of them regularly spend money on magazines.
Recently, Forrester released a report entitled “What Drives Retention and Sales In US Banking?” that tackles this question from the consumer point of view. Using regression analysis, we uncover how these drivers vary for acquisition, retention, and cross-selling in US retail banking.
What did we find? For one thing, consumers value trustworthiness from a bank above all else for both sales and retention. This comes as no surprise to us; with so many financial institutions to choose from, consumers want to do business with a bank that they trust. This finding also supports the key theme that Harley Manning and Kerry Bodine focus on in their recent book, Outside In: Treating your customers well and providing them with a positive customer experience pays off.
The graphic below shows the drivers of retention for the US retail banking customers: The perception of trustworthiness is off the charts as a driver of retention, and offering good customer service is the second-most influential driver. What our analysis shows to not impact retention — and even shows a negative relationship with retention — is having low APR and many locations.
If you search for “the death of email” on the Internet, you might be surprised by the number of articles on the subject. Why are so many people talking about it? Is this 40-year-old method of communication really under threat from social media? Does it mean that marketers will spend less on email marketing solutions? We paid close attention to these questions and many more when building the Forrester Research Email Marketing Forecast, 2012 To 2017 (US). We believe that spending on email marketing solutions will continue to grow. Why? We will see:
1. An increase in the number of active email users. Our email address is our online address, and it offers us universal interoperability. As per our forecast, we expect the number of active email users in the US to grow to 227 million by 2017.
2. The evolution of email clients. Over the past 40 years, email clients have evolved from text-based to desktop to web-based to mobile clients. As per our forecast, 178 million users —78% of all US active email users — will also access their emails through mobile email clients by 2017.
3. Email’s integration with social media. Email marketers have started leveraging a combination of email and social media marketing to get the best results. They are providing links to share via social media in their email messages and are encouraging their social media followers to subscribe to their email lists.
Consumer behavior is changing even more rapidly than you might think. In the past couple of weeks, my colleague Samantha Jaddou and I have been analyzing the data for the US version of our annual global series, “Understanding The Changing Needs Of Consumers.” We are seeing not only a decline in the number of US consumers with a computing device (a PC, laptop, or netbook) but also a drop in the amount of time that consumers spend on traditional media like watching TV (on a TV) or reading newspapers or magazines.
One of the biggest revelations in this year’s data was the change in attitude of consumers — particularly younger ones — toward the Internet. Since we started tracking this information in 1997, we have only seen the amount of time spent online increasing. But Forrester’s 2012 data shows that US online adults are now reporting a decline in the amount of time they spend using the Internet compared with 2011 and 2010.
What’s going on? Our analysis revealed that “being online” is becoming a fluid concept. Consumers no longer consider some of the online activities they perform to be activities related to “using the Internet.” In fact, given the various types of connected devices that US consumers own, many people are connected and logged on (automatically) at all times. The Internet has become such a normal part of their lives that consumers don’t register that they are using the Internet when they’re on Facebook, for example. It’s only when they are actively doing a specific task, like search, that they consider this to be time that they’re spending online.
Creators sit at the top of Forrester’s Social Technographics® ladder: They are the consumers who write blogs and articles, upload self-created video and music, post photos, and maintain their own web pages. More than any other group, Creators are shaping the face of consumer content online. We recently published a report called “Exploring The Social Technographics® Ladder: Creators.” It shows that Creators are great advocates for the brands they like, and that they have, on average, many more friends and followers to share their opinions with than any other group.
However, what was really intriguing is how much they value feedback from companies and brands. Even more importantly, more Creators expect companies to respond to positive posts about products/services than to negative ones.
This is contrary to popular belief. In fact, there’s plenty of advice out there on what you should do in a crisis or how to respond to someone who’s posted a complaint. There’s not much advice on how to handle positive feedback, but in fact, it’s one of the best ways to trigger (and motivate) your brand advocates.
My colleague Lindsey Colella and I attended the Vision Critical Summit in New York this week and were inspired by how market insights professionals are truly embracing the value of market research online communities (MROCs). Among the emerging and innovative methodologies, this is the one that we are seeing gaining significant traction: The Greenbook Research Industry Trends (GRIT) Report shows that this is the top emerging methodology used by client-side researchers — with 36% currently leveraging it.
What did we learn at the event? In addition to reinforcing MROC best-practice tips like closing the loop with panelists and incentivizing in a relevant way, which Lindsey recently wrote about in her report “Best Practices For Managing A Market Research Online Community,” the following best practices and examples caught our attention:
· Internal marketing is critical. Market insights professionals need to “sell” the value of MROCs to various business units across the organization. One electronics retailer did that by hosting monthly meetings in which the MI team presented all the research collected in the MROC to the cross-function business leaders.
The proliferation of mobile and portable Internet-connected devices has made TV multitasking the norm. Forrester’s Consumer Technographics® data shows that about four out of five US online adults who own a laptop, smartphone, or tablet go online regularly while watching TV, but the intensity of interaction differs by device.
My colleague Tracy Stokes wrote about this in a report called “The New Layers Of TV Audience Insight.” Her take: Just because your TV audience is active on social and digital platforms doesn’t mean that they will blindly engage with your brand. To drive cross-media engagement, you have to have a clear call to action that easily conveys why consumers should be active across multiple media channels.
But when you do it right, there’s a lot to gain. Research from Discovery Communications shows that exposure to more digital touchpoints while watching TV can strengthen consumers' connection to content and brands, not detract from it. Discovery's study found that users who multitask with devices while they watch TV are more attentive and responsive to TV programming and advertising than the average viewer.
Yesterday, I realized I have a criminal side. Of course, I know that I have a bit of a history for speeding. And I’ve had my share of parking fines. But until yesterday afternoon, I didn't think I had ever violated someone else's property rights. Now I know that I have – and I do it quite regularly as well.
The data protection laws talk about data. Data is defined as every type of information in a machine (device). When I’m talking and you’re listening, there’s no data. When I’m talking and you record my voice or take a picture, there’s data.
Consumer usage of alternative payment methods like contactless cards or mobile payments is still very limited in Europe, and the majority of European consumers aren’t interested in using these services (yet). But attitudes vary across Europe. In the UK, where consumers are more familiar with the concept thanks to public transport schemes like London’s Oyster card, about 4% of the population use contactless payment cards, and a further 22% are interested in using one. In Spain and Italy, a third of consumers show interest in such a payment system.
But security concerns and a lack of need are holding consumers back. While early adopters will more likely overcome them, these concerns represent a serious barrier to mainstream adoption.
Consumers have little motivation to adopt a new payment solution if it is purely a one-for-one replacement. Digital wallets must instead increase the value of the transaction for both consumers and merchants. Winning solutions will bring this to life through greater convenience, contextual relevance, and a compelling purchase experience.