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Articles by: "Rande Price, Research VP – DCN"

Advertising | Industry-Research

ISBA’s new research challenges the programmatic supply chain

The promise of programmatic advertising has always been its ability to target the right audiences, in the right context, at the right time. Buy and sell side participants look to maximize advertising opportunities, at the best possible price, leveraging technology to efficiently and smartly manage decision making in a dynamic environment. Unfortunately, the truth is far from the promise. Today’s programmatic ecosystem is far from delivering on trust, transparency, and efficiency across the digital marketplace.

A groundbreaking new report from ISBA, the British advertiser group, Programmatic Supply Chain Transparency Study, offers an end-to-end analysis of the programmatic supply chain that uncovers many of the reasons programmatic is failing to deliver on its promise. ISBA, in partnership with UK publisher organization AOP, commissioned PwC to conduct this two-year-long study that outlines the deep complexities of the ecosystem and the revenue impacts on advertisers and publishers.

The findings overwhelming speak to the complexity and the need to reform the programmatic advertising supply chain.

Complex ecosystem generates tracking chaos

The study set out to track every impression. However, only 12% (31 million) of the total 267 million impressions were effectively identified through the supply chain.

In total, there were more than 1,000 distinct supply chains detected across the 15 advertisers. The 31 million tracked impressions were matched end-to-end across 290 supply chains to the 12 publishers. The multitude of supply chain combinations adds opaque layers and complexity to the programmatic marketplace.

Publishers receive only 51% of all advertising spend

The waterfall of advertising spend shows 34% of all ad dollars goes to agency fees, DSP and SSP fees, and tech fees. Unattributable costs account for 15%.

The 15% unknown delta – nearly one-third of the supply chain costs – represents winning bids in the DSPs that could not be matched to any gross revenue recorded in the SSPs. There are many possibilities for the unknown delta, such as DSP or SSP fees that aren’t visible to post-auction, bid shading or post-auction financing arrangements, foreign exchange rates or reseller participation. However, no data provided mapped to the 15% delta

The study included 15 advertisers, 12 agencies, five DSPs, six SSPs and 12 publishers and represents approximately £0.1 billion of the UK’s programmatic ad spend or nearly two-thirds of the AOP’s digital ad revenues.

The ISBA research demonstrates a clear need to reboot. The starting zone needs to include contractual reviews, standardization of taxonomies, definitions and data protocols with an overarching focus on transparency across the board for all participants. Further, if the digital marketplace is to thrive, the industry must find ways to drive a higher percentage of advertising spend to publishers.

Industry-Research

Newsroom staffs were in steep decline even before the pandemic

According to a recent analysis from Pew Research Institute, newsroom employment in the U.S. dropped 23%, year-over year. The situation has been severely exacerbated by Covid-19. In fact, by April 10th, the media industry had already seen 36,000 layoffs attributed to the economic effects of the pandemic. The situation has grown so dire that last month, the News Media Alliance and America’s Newspaper sent a letter to Congress and President Trump asking the government to provide direct support to local newsrooms.

A decade of decline

Pew’s new research highlights the plight of diminishing newsrooms across the country at a time when Americans are in extreme need of local news. They found that, in all, there were about 114,000 newsroom employees (reporters, editors, photographers, and videographers) across the industry sectors of newspaper, radio, broadcast TV, cable and other information services in 2008. In 2019, there were only 88,000. Now with recent layoffs due to the financial impact of Covid-19, newsrooms are being reduced at an alarming rate.

The research shows that most of the newsroom declines occurred between 2008 to 2014. From 2014 to 2019, the number of total newsroom employees remained at 88,000. While four of the five key newsroom industries remained relatively stable, newspaper newsroom employees declined by 51%. In 2018, newspaper newsrooms had as many as 71,000 workers across the U.S. Today the number of employees is approximately 35,000.

Further, across the five industries of newsrooms, job growth only occurred the digital-native news platform. The number of digital-native newsroom employees more than doubled (117%) from 7,400 workers in 2008 to about 16,100 in 2019.

Shrinking newsrooms now account for a significantly smaller portion of overall newspaper employment, from 62% in 2008 to 40% in 2019. Needless to say, the pandemic is devastating revenues across media outlets. None have been entirely immune to its economic and staffing impacts.

Business model shifts

Shifts in business models are taking place to compensate news publishers for their content after years of social platforms disruption of content monetization. The Australian government announced on April 21, 2020 that Google and Facebook would have to pay publishers for their news content in their country. This monumental decision requires compensation for news articles displayed on Facebook pages or in Google search result. This is an important move to ensure tech platforms pay for the content fueling their advertising revenue growth.  

Newsrooms must monetize their content to survive. Identifying ways to support and compensate publishers for their content on platforms outside their owned and operated sites is critical to sustain the media ecosystem.

Advertising | DCN-Research

It’s time to align data practices with consumer expectations

From General Data Protection Regulation (GDPR) regulations in the Europe Union to the California Consumer Privacy Act (CCPA), consumer privacy is a focal point for digital media. These new data privacy and security laws speak to the need to reassess the collection and use of personal information in the digital media ecosystem. Importantly, it is time to review consumer expectations around current online data collection practices.

To better understand consumer expectations with online data collection practices, Digital Content Next (DCN) surveyed a nationally representative sample of adults in the U.S. Over the past few years, DCN has also queried consumers to better understand expectations for Google and Facebook, as public examination of tracking by major tech platforms became a critical focus.

Get personal

Overall, consumers expect websites and apps to collect data about them to personalize, protect and improve their experience. In sharp contrast, consumers do not expect outside vendors to collect data about them for reuse or sale.

When consumers are asked specifically about their expectations about the data practices of outside vendors, few are comfortable with the future reuse (38%) or the sales (24%) of their data. Interestingly, when consumers are provided with a clear explanation of how their data will be used and the benefit (i.e. such as collecting online data to identify consumers across devices), their expectations better align with the practice (47%).

Opt out

Understanding there is an option to be tracked shows low awareness. Only half of all U.S. adults (52%) report that they are aware of ways they can choose not to participate in online data collection.

Consumers also report a limited understanding of what it means to “opt out” or how to opt out of online data collection. Fewer consumers stated they opted out of online data collection or will in the next 30 days (40% combined) than those who do not know how to or do not understand what it means to opt out (44% combined).

How to

Unfortunately, the top consumer actions for opting out of online data collection are quite ineffective. Deleting cookies or turning them off often results in turning off both 1st and 3rd party cookies. First-party cookies offer consumers a seamless log-in and authentications process for subscriptions and memberships. Removing these cookies, can actually lead to a frustrating user experience. Regrettably, the “Do Not Track” signal is ignored by many tech companies. Also, consumer use of ad blockers penalizes the entire media ecosystem including the publishers and their advertisers.

Expectations

As an outcome of opting out of online data collection, most consumers expect more privacy, a better internet experience and enhanced security.

The research findings show the importance of aligning data collection practices with consumer expectations. Consumers do understand the need for websites and apps to collect online data. However, there’s a major disconnect with 3rd parties reusing in the future or selling this data. Importantly, it’s critical to understand what consumers demand, align expectations to those demands to help grow trust in our industry.

If you are a DCN publisher member, please be sure to log in or register to access the special member’s only Report, which will appear below this notice once you have logged in.

Industry-Research

Calculating the value of media content

As media companies look to their portfolio of brands to build or maintain their role as content destinations, it’s important to evaluate the production and consumption cycles of their news and entertainment content. To better understand these cycles and their business implications, the World Economic Forum (WEF) surveyed more than 9,100 consumers in China, Germany, India, South Korea, the United Kingdom and the United States. WEF also conducted six workshops with approximately 100 executives across the media industry to supplement their findings. Their new report, Understanding Value in Media: Perspectives from Consumers and Industry, offers key insights for the digital media marketplace.

Destinations versus ecosystems

WEF makes an important distinction between content players. There are content destinations, those companies where their content is the end point for consumers, such as a TV series or a news article. In contrast, content ecosystems are media companies, such as Amazon and Apple where the content is used as a tool to generate incremental revenue from their existing users. Another distinction is that destination media companies compete to become leaders in their respective areas, whereas ecosystem players are there to capture time, spend and data.

Content engagement is strong

Consumers are engaged with news and entertainment media as daily touchpoints. Eight in 10 consumers listen, read or watch news while nine in 10 watch entertainment content within a 24-hour time period. Further, close to 60% of consumers qualify as fully engaged, defined here as those who completed some form of registrations, either free or paid. In terms of future prospect, 53% report a willingness to pay for news in the future, up from 16% who pay today and 70% are willing to pay for entertainment content, up from 44%.

Young consumers, ages 16 to 34, are the most likely to pay for content. An average of 61% currently pay for entertainment content and 17% for news.

Generating revenue

Paid news and entertainment services, now a complement to advertising sales revenue, may serve as the future alternative to ad sales. Currently, more than two-thirds of news publications (69%) in Europe and the US operate some form of metered access.

Consumers report a global willingness to pay for content with 35% agreeing that they should be responsible for paying for and funding access to news and 44% agreeing for entertainment. They also expect governments to play a role in funding news compared to entertainment (35% versus 18% respectively). The findings suggest that consumers recognize the importance of news publishers to ensure a healthy political discourse. Further, close to a quarter of consumers think that tech platforms should also be responsible for supporting and paying for content.

Key strategies for publishers

In moving forward, publishers need to strategic and thoughtful in their approaches to the media business. WEF identified three key strategies:

Identify economies of scale

Publishers must focus on growing subscriptions by expanding audiences. Seemingly already in progress, publishers continue to identify new products to market to current subscribers as well as news prospects. This strategy extends to technology and telecoms offering products across media verticals (e.g. Verizon and ATT).

Make the consumer the primary customer

This approach looks to match consumers’ interests with marketing that speaks directly to them. Usually this is a combination of unique content and personalization. WEF’s research shows evidence that consumers are willing to pay more for personalized media and tailored content and it also helps with churn rate. 

Focus on identity

The “identity economy” refers to expenditures on products and services to form self‑expressions for consumers. Major advertisers are building closer alignment with identities and values in order to create a relationship with consumers. Some brands execute by sharing a brand values or partnering with a cause (companies giving proceeds to charity, etc.).

As the digital marketplace continues to grow, it’s important to pay close attention to how ecosystem companies integrate media into their activities. Publishers need to continue to think about the supply and demand of their content. It’s time to rethink the process of content creation, monetization and discovery especially in a media ecosystem and in an on-demand environment.

Industry-Research

Survey confirms Covid-19 news differs by source, often with misinterpretation

Results from a new Pew Research Center study show that consumers perceive news differently about Covid-19 based on as their main source of political news. The research asked consumers to identify their single most source for political and election news. The responses ranged from the three commercial broadcast networks (ABC, CBS, NBC) to The New York Times, NPR, CNN, Fox News, and MSNBC, as well as individual social media sites. The data reflected here represents the three major cable news networks: CNN, Fox News, and MSNBC.

Factual orientation

Consumers were asked if had seen mostly the same set of facts or conflicting sets of facts about the pandemic across various main news source. Three-quarters of all Americans who identified MSNBC as their main news source stated they had mostly seen the same facts. Of those who named FOX News as their main news source, only 53% reported that they saw consistent facts on the network. For those whose main source was cited as CNN, 65% stated that they mostly saw consistent facts.

While networks offer news reporting as well as opinion and commentary-based programming, the comprehension of truly factual information appears to be compromised. For example, one in four of FOX News consumers (39%) report that the virus originated in a laboratory (either intentionally or unintentionally).  Only 37% of Fox News consumers report the virus came about naturally. In contrast, 66% of MSNBC consumers report that they believe the virus came about naturally.

Further, consumers referring to MSNBC as their main political news source are far more likely to say the media covered the outbreak somewhat to very well (92%) compared to the Fox News followers at 58%. Followers of MSNBC are also much less likely than those who name Fox News as their main political news source to say the media exaggerated the risks posed by the pandemic (35% of the MSNBC group vs. 79% of the Fox News group).

Once again, consumers who refer to CNN as their main news source fall in between the MSNBC group and the FOX group (82% rate the media as doing somewhat or very well covering the outbreak; 54% say the media exaggerated the risks).

Political make-up

While not surprising, it’s interesting to see empirical data regarding political affiliation and how it differs by main news source. Slightly more than three-quarters of those who name Fox News as their main political news source identify the viewers then conservative Republicans and Republican-leaners, while 57% who name MSNBC identify as liberal Democrats and Democratic-leaners. Approximately four in 10 Americans (38%) who name CNN as their main political news source identify as liberal Democrats, with another 40% stating they are moderate or conservative Democrats.

Regardless of consumers’ political affiliation, the Pew research findings suggest that editorial commentary across the networks can distort facts. News outlets needs to identify, perhaps in BIG BOLD LETTERS, what is factual and what is personal commentary to help consumers distinguish between the two formats.

Uncategorized

On the alert for filter bubbles

There are currently no products, vaccines or drugs approved to treat or cure the coronavirus. However, that wasn’t the news on social media. There was much misinformation and many false claims populating consumer news feeds. In fact, Facebook is now coordinating with health organizations to make accurate information about the virus easier to find. Unfortunately, there are still many paths to misinformation.

Platform algorithms selectively guess what information a user would like to see. By filtering content, these platforms sort out news that we may disagree with or dislike. Filter bubbles narrow the opportunity to learn from differing perspectives and that’s cause for concern. Richard Fletcher at the Reuters Institutes explores these concerns in his study, The truth behind filter bubbles: bursting some myths.

Further, with heightened interest in Corona news, consumers seek platforms (e.g. Facebook, Google, Twitter) for their daily updates. It implores us to try to understand the impact of filter bubbles created by socially curated and algorithmically driven news content.

Personalization

Fletcher’s study contends that offline news sources, without algorithms, provide a natural filter effect. Offline readers self-select their new sources. The report refers to this as self-selected personalization. It’s the personalization we do by selecting what newspapers to buy, what TV channels to watch, and at the same time which ones to avoid.  

In contrast, online news consumption is often about pre-selected personalization, where choices are made for consumers by algorithms, without the consumer’s knowledge or understanding. Social media includes both self-selected personalization and pre-selected personalization. We know that people may choose to follow certain news outlets and not others. Algorithms offer no choice; they are not exposing people to news items outside of their interests or likes.

Polarization

Significantly, Fletcher’s research investigates the level of polarization that exists in online news consumption compared to offline news environment. The research looked at 12 different countries and found in general, online news environments are more polarizing than offline.

It’s important as consumers continue to receive their news on social platforms, that they actively seek out a range of news brands. Further, platforms are changing the way they serve news to people each day. It’s essential for the media industry, consumers and social advocates to critically examine the effects of algorithmic selection on news impact on society. Social platforms effort to ensure accurate information on the Coronavirus is easily accessible is a step in the right direction.

Industry-Research

Republicans are more likely than Democrats to suffer from news fatigue

Most Americans are stressed by the amount of news they get each day. In fact, this sentiment has been building for some time. According to a Pew Institute study seven in 10 Americans (66%) feel worn out by the amount of news they are getting. The study was conducted among more than 12,000 U.S. adults.

The news cycle is faster than ever before coupled with instant notifications on cell phones. Today, the news comes at the consumer 24/7. Yet those watching or reading the news feel a sense of detachment.

Political differences

Interestingly, news fatigue is more common among those the least politically engaged. Even consumers not engaged in political or election news report feeling exhausted from it. There’s a similar attitude for those more generally interacting with political. Consumer who discuss politics a few times a month report feeling drained by the news by at least 10% more than those who engage in political news almost every day (69% vs. 59%, respectively).

Republicans are more likely than Democrats to feel wiped out by their news intake. Seventy-five percent of Republicans report being exhausted from the news compared to 59% of Democrats.  This same gap was reflected in 2018.

The toll

This Pew Institute study show the consistent impact of news consumption on consumers.  The reality of a 24/7 news cycle and its immediate availability appears to be taking psychological toll on consumers.

Immediate questions to ask include whether consumers will begin to tune-out and distance themselves from their sources. Publishers may want to talk to their readers to provide context and healthy distancing patterns in order for news content to be less stressful in the consumption process.  

Industry-Research

How flagging content really affects the perception of truthfulness

In an attempt to act responsibly, social platforms now flag content that is certain to be false. However, flagging disputed content has some unintended consequences. False headlines that aren’t flagged are often thought to be true. In fact, according to new research, The Implied Truth Effect, conducted by Gordon Pennycook, Adam Bear, Evan T. Collins, and David G. Ran, false headlines that fail to get tagged are viewed as more accurate. Thus, the research appropriately questions whether the policy of using warning tags to fight misinformation is effective.

False news headlines with flagging

This research includes two studies. In the first, the control group was shown both true and false news headlines without any warning labels. The test group was shown both true and false headlines; the false news headlines included warning labels. Participants were asked how accurate the headlines were and if they would consider sharing the story on social media (such as Facebook or Twitter).

The first study confirms that content with warning labels decreased the belief in items that are flagged (the Warning Effect) but increases belief in items that are untagged (the Implied Truth Effect). In other words, headlines that were not flagged in the test group, were rated as more accurate, by at least one-third, than those in the control group

True news headlines with flagging

The second test included a control group and two test groups. Participants were presented with news headlines and asked whether they would share on social media. They were told that 75% of the headlines had been fact-checked by Snopes.com.

The control group was shown true and false news headlines without any labeling. The first test group was shown false news headlines, half with a “FALSE” stamp and the other half without any stamps. The second test group was shown false news headlines with a “FALSE” stamp and true news headlines with a “TRUE” stamp.

The findings show that participants in the first test group were less likely to consider sharing false headlines tagged with a warning compared to false headlines in the control group. Further, participants in the second test group were more likely to consider sharing true headlines tagged with a verification compared to true headlines in the control group.

W = Warning, W+V = Warning + Verification

This research identifies the consequence of attaching warnings to some inaccurate headlines but not all. It’s safe to assume that a large percentage of false headlines will continue to appear on social platforms and remain untagged. However, it is important to note that it may be even more valuable to tag true headlines.

Labeling truthful and verified headlines helps consumer identify what is true and suggests that everything outside this stamp is potentially false. While this research was is experimental in its design, it’s important to take next steps to explore the impact of full stories. Future work should investigate the impact of warnings on the users’ likelihood of clicking through to read the full articles, and the impact on sharing after reading the article.

Advertising | Industry-Research

Consumers oppose being microtargeted by political advertising

Consumers are very aware that social platforms and websites collect information about them. However, most Americans say political campaigns should not be able to target them with digital ads based on their online activities. In fact, according to the Knight Foundation and Gallup’s new research, nearly all say they believe that Facebook and Google (97%), Amazon (96%), and news sites or apps (88%) collect data on their browsing history and purchasing habits. However, this research found that 72% say that internet companies should make no information about users available to political campaigns in order to microtarget certain voters with online advertisements.

Limited targeting

A much smaller population of consumers (20%) state that general details about internet users, such as their gender, age or zip code should be permissible to use for targeting. This is in line with the advertising policy at Google, which limits the information political campaigns can use for targeting. Interestingly, 7% of U.S. consumers are okay with microtargeting saying that any information should be made available for a campaign’s use. This is consistent with Facebook’s practice, which does not place any such limits ad targeting.

Acceptable approach

Almost 60% of consumers favor websites showing ads with the disclosure of who paid for the ad, how much it cost, and whom the ad is aimed at. However, there’s a smaller consumer population (20%) that wants no political advertising in absolute terms. This is the policy adopted by Twitter.

An even smaller consumer base of 4% want no political ads shown in the final month of an election campaign. Juxtaposed to this is 16% of consumers who believe ads should not be regulated because they are a form of free speech.

Further, almost all consumers believe platforms should refuse misleading content in political ads.

Specifically, consumers said social media should not allow political ads that would target supporters of an opposing candidate and provide the wrong election date (81%). In addition, consumers said that platforms should not allow display ads that say a politician voted for a policy if in fact, they did not (62%). Close to half of all consumers (45%) think that social media companies should not accept ads that misrepresents or omit facts about a candidate.

Political parties react differently

  • Democrats are more likely than Republicans to favor stronger policies regarding content in political ads. Nine in 10 Democrats (91%) say an ad targeting an opponent’s supporters with an incorrect election date should be refused, compared with 73% Republicans.
  • Seven in 10 Democrats (71%) compared to Republicans (55%) say an ad that contains an inaccuracy about a politician’s voting record should be refused, while half of.
  • Fifty percent of Democrats say an ad omitting some details about a candidate’s position should be refused compared to 41% of Republicans.

Currently, there’s much debate in D.C. and Silicon Valley about microtargeting political ads. Social seem content to make their own policy decisions. Unfortunately, this leaves consumers very vulnerable and concerned about the often divisive, and even false

Industry-Research

How “Behind the Story” cards affect readers’ trust in the news

In an effort to provide more transparency in journalism, McClatchy, a local news publisher with a footprint in 30 markets, designed an information card to help readers better understand the reporting process. To evaluate its effectiveness three McClatchy newsrooms undertook a study to explore whether the placement of these informational cards on a news organization’s website affected readers’ recall of the card and trust in news.

The information cards, called Behind the Story (BtS), highlight why a topic is important to write about, how the story is written, and who the journalist interviewed. The Center for Media Engagement, in partnership with three McClatchy newsrooms: The Wichita Eagle, El Nuevo Herald and The Sacramento Bee, conducted research with over 300 participants to assess recall and efficacy of the BtS cards.

Overall, the findings show that, while the BtS card appealed to most readers, a majority of readers did not notice the presence of the card when placed within the context of an article. Importantly, however, when shown outside the context of an article, a majority of readers said the card would improve their trust in a news organization.

Recall

In all, 34% of respondents said they remembered seeing a section titled “Behind our Reporting” when the card was placed within the context of the article compared to 21% who recalled seeing the BtS card when placed at the bottom of the article. Although a higher percentage of people noticed the BtS card when it was placed in-line, the difference in overall recall is not statistically significant compared to the card appearing at the bottom of the article.

Interestingly, non-subscribers were significantly more likely to recall the card when it appeared in-line (40%) than subscribers (30%).

Trust

Placement of the BtS card, in-line or at the bottom of the article, did not impact participants ratings to the trustworthiness of the article, the news organization or the reporter in a significant matter. Overall, the study suggests that using a card designed to improve transparency may positively affect trust. However, newsrooms need to ensure that it’s noticeable.

Previous research from the Center for Media Engagement found that less than 10% of readers in three communities thought that their local newsrooms adequately explained how and why they decide what stories to cover.

With efforts like these, McClatchy is taking important and positive steps to help strengthen readers’ trust and negate concerns with misinformation and fake news. Fine tuning the placement of the BtS card and its messaging are encouraged. Future research should assess additional BtS designs, verbiage and continue to test best placement and overall impact on recall and trust metrics.

Industry-Research

Publishers prepare for 2020 with technology investments

Digital publishers see rays of hope as they continue to monetize premium content, transform business strategies, maximize technology investments, and increase revenue diversification. Just over two-thirds (69%) of digital publishers expect to see an overall revenue growth in 2020 according to a new report, Publishers Bullish on Talent, Tech and Growth in 2020, from Folio. Of those publishers expecting revenue growth, a quarter anticipate double digits. Only 4% of participants expect revenues to decline. This research is based on 182 surveyed industry professionals accompanied by eight in-depth executive interviews.

Growth expectations

Respondents report the top three categories for revenue growth are digital advertising including branded content (58%), live events (43%), and marketing services (38%). In addition to revenue growth, audience growth is also expected in 2020. Twenty-eight percent of publishers expect a 10% growth in audience while more than one-third (36%) expect single-digit growth. 

Audience development is more than just chasing clicks on digital platforms. It’s about learning your business ecosystem and how the pieces work together. Executives cite email (54%), social media (53%), and events (44%) as the strongest performers for audience development. 

2020 priorities

Publishers recognize the need to invest in the video side (35%) of their business as well as back end technology and operation systems (34%) for content management and advertising businesses. Publishers, especially traditional magazine businesses, see video as a very lucrative way to reinvent their content strategy and distribution model with attractive advertising packages at high CPMs.

Executive interviews

Catherine Levene, President, Chief Digital Officer of Meredith Corporation, participated in Folio’s executive interviews. Meredith charted its course in preparation for 2020. Levene said Meredith is keenly focused is on innovation. This includes technology investments, including a new content management system and a first-party data and insights platform.

She also mentioned Meredith’s investments in video production and distribution and new content-to-commerce capabilities. Levene sees a win-win for their audience and advertisers, “We are creating content and experiences that drive engagement and are offering predictive advertising that achieves results for our marketing partners.”

Erin O’Mara, President of The Nation, also participated in the executive interviews. O’Mara described the digital business as more than just a website, it’s about super-serving the audience. A new initiative, “The Nation Classroom,” uses their archives to create robust teaching modules for high school student. The goal for this project is to be profitable as well as to make available to schools that cannot afford it. O’Mara see this initiative as an important step to extend a brand experience through community outreach.

As Folio’s research suggests, there is no time digital media brands to standstill. It’s essential for media companies to take the steps to identify the key business and audience strategies and investment in them.

Industry-Research

Gen Z not only loves content, they pay for it

Media is embedded into the lives of Generation Z. This group, ages 14 to 22, are digital natives and socially driven. According to a new report from VICE Media in partnership with Ontario Creates, Gen Z: The culture of content consumption, media and pop culture have a significant impact on their identity. This study focuses on how Gen Z discovers, consumes and shares cultural content. This is defined as film and TV, art, lifestyle, gaming, music, and literature. (It excludes politics and hard news).

Three quarters of the Gen Z respondents (75%) report that original content is important to them. They like to hear about different topics and are open to storytelling in new and creative ways. Gen Z also likes to explore and engage in a variety of different voices and viewpoints. Their number one content preference is music followed by humor, memes/internet culture, gaming and food, dining and drinks.

Content discovery

Gen Z discovers content most often from personal recommendations from family and friends, music streaming services like Spotify and Pandora and from publisher websites.

There were born to social platforms and it plays an important part in their content discovery. YouTube is their number one content source with Instagram as a close second followed by Facebook and Snapchat. TikTok is also gaining popularity. Gen Z tends to like content on social platforms, that is transparent, with few barriers between the creator and the audience. In order to successfully engage with Gen Z, publishers should experiment with different storytelling techniques on social platforms.

Multitasking

True multitaskers, Gen Z often has a second device in hand (60%) while watching shows and movies for entertainment. The second device is used to socialize, engage in another entertainment mode (e.g. gaming), or find complementary information on the content being viewed.  

Subscriptions

Nearly all of Gen Z consumers (90%) pay for their content with, on average, four different content subscriptions. Music and video streaming are the top paid services followed by console games, PC games and mobile games. Gen Z reports that they are willing to pay for content if it offers better quality (61%), better experience (56%), and is more convenience (50%). Only four in 10 noted the need for an ad-free environment. Gen Z is looking for a frictionless and personalized experience with their subscriptions. They like the idea of platforms curating high quality content for them.

Pop culture and media play an important role for Gen Z. To attract this generation, publisher’s content should strive to:

  • Embody diversity
  • Entertain as well as inform
  • Attract global representation
  • Empower and support unique voices
  • Ensure quality (advertising platforms are fine)
  • Promote discovery and engagement across platforms

Importantly, the content needs to connect with Gen Z on an emotional level and showcase authenticity. Gen Z is conscious of content brands and publishers should think about ways to establish their credentials with this generation.

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