Getting Consumers' Attention

© Copyright 2009. Yankee Group Research, Inc. All rights reserved. Page 1August 2009Getting Consumers’ Attention© Copyright 2009. Yankee Group Research, Inc. All rights reserved. Page June 2009© Copyright 2009. Yankee Group Research, Inc. All rights reserved. www.yankeegroup.com

Getting Consumers’ Attention

August 25, 2009

Carl D. Howe, DirectorAnywhere Consumer Research

© Copyright 2009. Yankee Group Research, Inc. All rights reserved. Page 2August 2009Getting Consumers’ Attention© Copyright 2009. Yankee Group Research, Inc. All rights reserved. Page June 2009

© Copyright 2009. Yankee Group Research, Inc. All rights reserved. Page 3August 2009Getting Consumers’ Attention

My Main Point Today

Anywhere Media is transforming media

and advertising


Agenda

• The Anywhere revolution

• Changing consumer behavior around media

• Recommendations

• Q&A


Connectivity Sparks

• A common network

• Broadband demand

• Wireless ubiquity

These are forming theAnywhere Network


Anywhere Is a Revolution

Battles under way and ahead willtransform the world we live in.

This will bring the largest technologychange in our lifetimes.


Mobility Is Driving Anywhere


Wireless Growth Is Driving Italy Past the Anywhere Tipping Point


And Japan…


. . . And Even the U.S.


Poll 1

Have you watched a television show on your computer in the last 30 days?


Food for Thought: NBC Universal’s “Heroes”Watch Episodes Online for Free

• NBC Universal Total Audience Measurement Index (TAMi)• Second episode of “Heroes”• Note: Log scale

• Audience size = 17 million people• Implications and repercussions

• Pay TV, ISP, media


But TV Audiences Have Been Shrinking

Source: Yankee Group and TV Bureau of Advertising, 2009


Internet Sites Are Growing Dramatically

Source: Yankee Group, Internet Systems Consortium, MediaPost, ClickZ, AllBusiness.com, Media Buyer Planner, Zooknic.com, 2009


Mobile Internet Domains Are Growing More Than 500 Percent a Year

Source: Yankee Group and dotMobi, 2009


Internet Ad Prices Are in Free Fall

Source: Yankee Group, Internet Systems Consortium, MediaPost, Clickz, AllBusiness.com, Media Buyer Planner, Zooknic.com, 2009


Agenda



• Recommendations

• Q&A


Consumers are drowning in a surplus of media choice


U.S. Consumers Now Spend the Most Time Online

Source: Yankee Group Anywhere Consumer: 2008 U.S. Entertainment Survey* Yankee Group estimate; this response was not listed in this survey question

How much time do you spend daily on the following activities?


Poll 2

Which activities do you do while watching television?


Plus They Multitask More

• More than half of respondents acknowledge that they are online or talking on the telephone while watching television.

• Advertisers take note: This shows consumers are saturated with media.

Which of the following activities do you do while watching TV?

Source: Yankee Group Anywhere Consumer: 2008 U.S. Entertainment Survey

n = 1,503

Percent of Respondents

11%

8%

11%

16%

27%

33%

36%

53%

56%

60%

0% 10% 20% 30% 40% 50% 60% 70%

Other

SMS

Listen to the radio

None of the above

Instant message

Read the newspaper

Read a magazine

Talk on the phone

Surf the web

E-Mail


Remember This?Online Ad Revenue Is a Third of TV Revenue

© Copyright 2009. Yankee Group Research, Inc. All rights reserved. Page 23August 2009Getting Consumers’ Attention© Copyright 2009. Yankee Group Research, Inc. All rights reserved. Page June 2009

Is Anywhere Taking the Media Industry Here?


Anywhere Media is transforming media

and advertising

Remember Today’s Main Point


Anywhere media

Screen independent, on demand and easy to consume

Anywhere Consumers

Mobile Mobile InternetInternetInternetInternetTVTV Other Other

DevicesDevices

TV consumers

TV media

Internet consumers

Internet media

Mobile consumers

Mobile media

Changing the Channels to Anywhere Media

Anywhere Media is media delivered to consumers when and where the consumer will pay attention to it.


7%

10%

20%

28%

30%

36%

55%

82%

0% 20% 40% 60% 80% 100%

Other

Can watch outside of my home

Like older/classic TV shows

Was interrupted while watching onTV

Wanted to watch the programagain

Has fewer commercials

Catching up with older episodes

Missed the episode when it wason TV

Consumers Use Internet Video as Video on Demand

• 82% of Internet video viewers watch TV shows online because they missed the episode on TV.

• VoD numbers pale in comparison.

• DVR is more about ad skipping than time shifting.

• 79% of DVR owners fast-forward through commercials most or all of the time.

• DVR owners are more likely to watch online when they fail to watch or record an episode.

• Internet video is not yet compelling enough for viewers to cancel their pay-TV services.

.

Why do you watch full episodes of TV shows online?

Source: Yankee Group Anywhere Consumer: 2008 U.S. Entertainment Survey

n = 294 (watch full episodes of TV shows online)

Percent of Respondents

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AT&T’s Masters Coverage Showed Promise


Anywhere Media Results in the U.S.

Advertising revenue for TV won’t pass 2008 levels until 2012.

$52,675 $50,459 $50,357 $51,686 $53,791 $56,177

$23,204 $23,632 $23,289 $25,642 $28,436 $31,127$115 $184 $241 $323 $431 $566

2008 2009 2010 2011 2012 2013

Mobile InternetInternetTV


Agenda



• Recommendations

• Q&A


Recommendations

Media companies:• Think twice before committing to an ad-only business model.• Embrace a flexible content platform.

Advertisers:• Negotiate extra spots in 2009 and 2010 with your media buys.• Look for ways to be less obtrusive.• Demand measurable results.

Network operators• Recognize that video is the lead property.• Don’t overpromise behavioral ad data.


And Recognize That Mobile Isn’t the Last Screen


And New Kinds of Consumers Need New Services


Conclusions

• Consumer attention will limit media and advertising growth.

• Anywhere Media is transforming media and advertising.• Consumers are drowning in too much media.• Consumers will choose how and where they access media.• The media business must adapt to consumer choice.

• TV advertising will get a reality check during the next two years.

• Don’t think mobile is the last screen.


Q&A

Did you know? Teens still discover music through friends and radio.

Yankee Group’s Attitude & Behavior Surveys track this data and more.

Sign up for a complimentary snapshot of our most recent results at

http://www.yankeegroup.com/live/survey_data_snapshot.html.


Q&A

Did you know? Of people with a mobile phone, smartphone users spendsignificantly more time using the mobile Web.

Yankee Group’s Attitude & Behavior Surveys track this data and more.

Sign up for a complimentary snapshot of our most recent results at

http://www.yankeegroup.com/live/survey_data_snapshot.html.


Carl D. Howe, Director, [email protected]

Next Yankee Group webinar:Pinning Down Cloud ComputingSeptember 29, 2009Register at www.yankeegroup.com

Thank you!