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Research / Insights on current and emerging industry topics

Growth of the native digital experience

December 4, 2015 | By Rande Price, Research VP – DCN

Generation #hashtag is definitely changing the way we consume content. These consumers, regardless of their age, prefer native digital content, that is content and services designed and distributed exclusively through digital (includes mobile) channels. This generation now accounts for half of the entertainment audience (47%) and more than a third of the audience for online services (37%) and publishing (34%) according to Bain & Company’s annual research study conducted among 7,000 consumers in 10 countries.

The native digital experience introduces new digital monetization models as well such as single purchases, subscription and micropayments. Further, contrary to what many think, younger consumers are more willing to pay for native digital content than those older. For instance, 30% of consumers under age 26 are more likely to pay for some forms of digital videos versus 23% of consumers older than age 26.  This also holds true for digital music (34% of younger more likely to pay than 18% of older) and the purchase of games (40% of younger more likely to pay than 28% of older).

Traditional based models for content monetization rely heavily on the consumer and/or the advertiser to pay whereas digital native platforms often blend models. One such blended content offering is freemium where the product is offered free but any proprietary features and/or functionality will cost extra. Another example is crowdfunding where money is raised online via donors to fund a project that is would normally be a financed business venture.

Importantly when thinking of new monetization models keep in mind five key essentials: 1) content strategy, 2) distribution routes, 3) advertising models, 4) use of consumer data and 5) merger and acquisitions tactics. It’s imperative now more than ever that companies develop a native digital experience rather than digitizing already existing content and experiences.


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