The war for attention and advertising dollars will intensify next year, according to predictions by analysts at global research house Forrester.
Consumers are spending a lot of time and money watching and listening to content on platforms such as Netflix and podcasts produced by news publishers.
"These content delivery channels will vie for consumer attention and advertiser dollars as the competitive landscape heats up in 2020," says Forrester in its 2020 media predictions report," says Forrester in its 2020 media predictions report.
"Consolidation, streaming wars, and new media offerings will grab headlines next year."
Subscription fatigue for streaming services will lead to new offerings.
The subscription trend hit its peak in 2019 with new streaming services, such as Disney+ and Apple TV+, emerging to compete with Netflix and Prime Video.
Consumers subscribe to many of these services to get the content they want.
"But come 2020, consumers will be exhausted — and will recognise they are over-spending — on all of these services," says Forrester.
"We are seeing the beginning of this fatigue as Netflix missed by almost half on the expected number of new subscribers in Q2 2019 and again missed, though less dramatically, in Q3.
"Consumers will force media conglomerates to offer tiered service bundles where the customer will choose what they pay for specifically — down to an episode of a show."
Podcasts
Podcasts will be the next $1 billion media market.
"We predict that the podcast market will explode in 2020 as more publishers build out their own podcasts to open a new revenue stream and advertisers continue to increase spend," says Forrester.
Podcast ad spend reached $US400 million in 2018, according to the Interactive Advertising Bureau (IAB), and could easily hit $US1 billion by the end of 2020.
Consumers are spending a lot of time listening to podcasts.
Spotify had a 250% year-over-year increase in podcast consumption hours from 2017 to 2018, and US online adults spend an average of over three hours per week listening to online audio content
And listeners are 45% more likely to have more than $250,000 in income.
"Advertisers want to get in front of these consumers with lots of disposable income, and publishers want to deliver their content in new ways to continue making money," says Forrester.
Retailers as media platforms
The trend for big retailers to transform themsels as media platforms will accelerate.
Amazon Advertising launched in Australia earlier this year. The US-based online retailer was reportedly offering exclusive deals and data partnerships to get close to media agencies.
Amazon pulled in more than $US10 billion in advertising revenue in 2018, which woke up other retailers who have traditionally competed against Amazon.
Walmart will have self-serve ad tools by the end of 2019.
In Australia, Woolworths has launched Cartology, the first step in the supermarket group's commercialisation of its media operations.
"Another major US retailer recently sought Forrester’s advice as to how it could formulate a new ad revenue stream," write the analysts.
"Don’t expect this trend to change as retailers try to diversify their businesses and open up new, lucrative, and high-margin revenue streams."
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