UPDATE: Chris McCrudden had a great Twitter thread about this which I’ll add to the bottom of this post.
via VITAL DATA: What every comms person needs to know about the Ofcom communications market report 2018
Please read @danslee excellent article. I wanted to share here to highlight two graphics:
We are maintaining social media
In the UK in 2018, 77 per cent have a social media account.
Comscore research, which is referenced in the report shows the league table of UK users:
YouTube 44.3 million
Facebook 41.8 million
Twitter 27.5 million
Snapchat 22.7 million
Messenger 22.3 million
Whats App 21.0 million
So @Ofcom‘s annual Communications Market report is out today & is super-interesting on
👂the rise of audio
📺the decline of telly
📱what ubiquitous smartphones have done to our daily lives.Hold me, I’m going in…https://t.co/v8HrJRmyIN
— Chris McCrudden (@cmccrudden) August 2, 2018
1. The communications market is… SHRINKING.
TV, radio, telecoms & the mail account for less revenue each year.
Why? Telecoms getting cheaper, TV & radio losing ad money to the Internet
And our eyeball-time (and money) is going to Netflix, who aren't covered in this research. pic.twitter.com/DuUsEwGh2L
— Chris McCrudden (@cmccrudden) August 2, 2018
2. Growth is happening where Ofcom can't track it.
These graphs tell you that avg consumer spend on comms & entertainment has fallen in real-terms. It'd look v different if we layered on Netflix, Amazon, iTunes data.
(Which we can't because US tech co's keep data secret.) pic.twitter.com/Kv3nivq7B4
— Chris McCrudden (@cmccrudden) August 2, 2018
3. The durability of bundling
It's really interesting is how telcos have managed to keep their lion's share of consumer comms revenue & even find growth in a market with constant downward price pressure.
They seem to have done that through bundling services. pic.twitter.com/KGJFMH9C30
— Chris McCrudden (@cmccrudden) August 2, 2018
4. Why is bundling attractive
The business analyst in me wants to say that selling services as a bundle is a great way to deliver 'added value' to consumers.
The cynic in me also wants to say that it's a great way to pad out your prices. pic.twitter.com/4gfzyoBtYB
— Chris McCrudden (@cmccrudden) August 2, 2018
5. 40% of UK consumers have a Netflix account (or equivalent)
Ofcom can't track the revenue generated by Netflix, Amazon, but it can project how many consumers use their services. 39% in the UK, up from 14% in 4 years.
That's impressive growth. pic.twitter.com/zFOGuiNuYk
— Chris McCrudden (@cmccrudden) August 2, 2018
6. TV is still crack for the eyes… for the over 50s
Across formats & platforms, TV is beginning to look like an 'old person's' medium.
This may lead to an interesting tipping point. When does it become pointless to make TV shows for younger viewers? pic.twitter.com/4K20GBIbKU
— Chris McCrudden (@cmccrudden) August 2, 2018
7. Why should we care about younger viewers?
There's a strategic danger in broadcast TV letting audience averages drift up. It could lead to it producing content for *a base* which actively excludes other audiences.
Look at what happened to the post-paywall Times. pic.twitter.com/mQhkGvEfQb
— Chris McCrudden (@cmccrudden) August 2, 2018
8. The Golden Age of TV
This graph is so interesting. As a country we're watching less TV together, but the kind of shows we watch together hasn't changed.
Drama accounted for 16% of programmes with 5m+ viewers in 2010 & 2017 pic.twitter.com/kFRqT4iywf
— Chris McCrudden (@cmccrudden) August 2, 2018
9. Entertain me, just not 8m of us
But things have changed a lot if we look at the big hit shows (attracting 8m+ viewers)
2010: 73% of hit shows were entertainment, 4% were drama
2017: 31% of hit shows were entertainment, 26% were drama pic.twitter.com/eLexEGWskq— Chris McCrudden (@cmccrudden) August 2, 2018
Ok, so we're going back into @Ofcom's Communications Market report to talk about my favourite media.
AUDIO! pic.twitter.com/lC4PbOXaL1
— Chris McCrudden (@cmccrudden) August 3, 2018
10. The resilience of radio
The average UK consumer listens to 10 hours of commercial radio a week. Yet radio still only commands 3% of ad money.
I've lost count of the amount of times I've urged clients to invest in radio. It's not sexy, but it's so effective. pic.twitter.com/NHcL3RPSlh
— Chris McCrudden (@cmccrudden) August 3, 2018
11. Smart speakers
I shared some @NPR research about this a couple of weeks ago.
Smart speakers are remarkable: they've attracted older consumers from the beginning. pic.twitter.com/88My3r4Iyi
— Chris McCrudden (@cmccrudden) August 3, 2018
12. Will Alexa kill the (DAB) radio star?
DAB radios are a mature technology, but still only account for c. 50% of radio listening.
Smart speakers are capturing listener share far faster. It's starting to look like the tech that will take Internet radio mainstream. pic.twitter.com/P3va4VxiCX
— Chris McCrudden (@cmccrudden) August 3, 2018
13. PODCASTS
Weekly consumption of podcasts is now almost at 20% for younger listeners (which are exactly the kind of listeners that broadcast radio is struggling to target). pic.twitter.com/YrD6xsyODb
— Chris McCrudden (@cmccrudden) August 3, 2018
14, Podcasting 4 teh menz
I'd be really interested in seeing how the male bias in podcast consumption breaks down across age groups. Men over the age of 35 are notoriously difficult to reach effectively. pic.twitter.com/W25Oe0ZFde
— Chris McCrudden (@cmccrudden) August 3, 2018
15. Are podcasts an inflection point away from live radio?
While podcasts don't *replace* live radio consumption, listening to podcasts looks like a gateway into consuming a wider range of audio content across platforms. pic.twitter.com/qGJ3ikmtdr
— Chris McCrudden (@cmccrudden) August 3, 2018
16. Podcasts are under-exploited and cheap.
Podcasts take an estimated 0.03% of annual advertising spend in the UK. pic.twitter.com/dUCG8zYDkh
— Chris McCrudden (@cmccrudden) August 3, 2018
In conclusion, broadcast TV is losing salience with younger consumers.
But audio is gaining salience with harder-to-reach demographics (particularly men) and ad space looks under-exploited.
I'll be continuing to tell my clients to listen. I hope they hear me. pic.twitter.com/3RzoZoA65k
— Chris McCrudden (@cmccrudden) August 3, 2018