Media and Entertainment in Focus2020 Digital Trends

2020 Digital Trends—Media and Entertainment in Focus 2

Executive Summary 4

1. Content still reigns for business focus 6

2. CXfocusandconfidenceontherise—especiallyasabrand

differentiator

3. Puttingtherightinfrastructure,strategy,andinvestment

inplace

4. Transformativetechnologiesarebeingembraced—but

challengeslieahead

Methodology 20

Table of contents

2020 Digital Trends—Media and Entertainment in Focus 3

Foreword

Welcome to Adobe’s Digital Trendsreport,ourannual

surveyofmarketing,advertising,e-commerce,creative,and

technologyprofessionalsaroundtheworld.Nowinits10th

year,Digital Trendscontinuestorevealthemostsignificant

shiftsintheindustrythataredrivingmarketingstrategies,

companyinvestment,andconsumerbehavior.

This10theditionofthereportgivesustheopportunity

toreflectonthelastdecade.Adobe,inpartnershipwith

Econsultancy,hasgatheredmorethan75,000senior

leaders’experiencesandinsightsacrossthisperiod.Our

commitmenttomeasuringtheindustryviewpointfrom

business leaders and influencers delivers a fascinating

windowintohowmuchchangethetechnologysectorhas

experienced.

Whenweproducedthefirstreportin2011,marketerswere

obsessedwithdigitalchannels.Howwouldsocialmedia

impacte-commerce?Wouldpeoplebuyanythingonamobile

device?Howwouldtelevisionadvertisingbeaffectedby

digitalchannels?

Ofcourse,thelandscapeweoperateintodayisvery

differentfromthatof2011.Today’sconsumerexpectations

arefargreater,butsoistheopportunity.Technologyand

dataareempoweringbrandstobuilddirect,emotional

relationshipswithconsumersthatarechangingtheway

businessesoperateforever.Thisisaneweraformarketers.

Wecanunderstandandinteractwithouraudienceinmore

meaningfulwaysthaneverbefore.

Thisalsoposeschallengesforbrands.Customer-centricity

ismagnifyingorganizations’structural,cultural,and

technologicalbarriersthatshapedatamanagementand

customerexperiencedelivery,andultimatelydefinebusiness

success.Theregulatoryenvironment,artificialintelligence,

andemergingtechareallprovidingchallengesand

opportunitieswhoseimpactareexploredindetailinthereport.

Fundamentally,theDigital Trends 2020reportshowsthat

todaythevalueofcustomerexperienceisunquestionable.

Brandsleadingthewayincustomerexperiencearethree

timesmorelikelytohavesignificantlyexceededtheir2019

business goals.

Digital Trends continues to be a valuable tool for our teams

atAdobeandmarketersacrosstheglobetotrackindustry

developments.Thisyear’sreportisafantasticopportunity

toreflectonhowthesechangeshaveevolvedoverthelast

decadeandhowtheydrivesuccessforourcustomersin

2020 and beyond.

Michael GrierMedia & Entertainment Industry Strategy & Marketing

2020 Digital Trends—Media and Entertainment in Focus 4

Premium content is top priority

• Mediaandentertainmentcompaniesareinthebusinessofpremiumcontent,withvideobeingthemostimportant.Almosthalfthebusinessesinthesector(43percent)saidvideocontentwastheirtoppriorityfornextyear,andaquarterseetheextensionofcompellingcontentacrossalldigitalexperiencesastheirbiggestopportunityin2020.

• Buildingamultichannelstrategyforvideoisacorecompetencyformediacompanies,requiringcomplexorchestrationofcreativeformats,deliveryworkflows,anddatatechnologies.

Competitioninthemediaandentertainmentindustryremainsfierceascompaniesbattletolaunchnewdigitalservices,developpremiumsubscriptionofferings,andtransformoperationstobecomedirect-to-consumerbrands.Contentremainsthekeydifferentiator,butinanincreasinglyatomizeddigitalenvironment,consumerexperienceandengagementlieattheheartofbusinessstrategy.

Mediacompaniesarehavingtoevolverapidly,andthe2020 Digital TrendsreporttakesalookatsomeofthebuildingblocksandkeyCXtrendsthatareimpactingtheindustry.Itexploresthemesaroundtechnology,datainfrastructure,automation,businessstrategyandROI,andtheirimplicationsforthemediaindustryinbuildingCX.

Why?Thefinancialbenefitsareclear.The2020 Digital TrendsreportshowsCXleadersarethreetimesmorelikelythanotherindustriestohaveexceededtheirbusinessgoals.

Ourresearchindicatesthatthereisconfidenceacrosstheindustryinitsabilitytocreateexceptionaluserexperienceswhichoutstripsallothersectors.

Butdomediaorganizationshavetherightinfrastructureandinvestmentroadmapsinplacetochangethewaytheyoperatetoreinventuserexperienceandmeetchangingconsumerneeds?Oraretheyhamperedbyinefficientlegacyprocesses,complexandtime-consumingintegrations,andlackofbudgetastheyincreasinglyadoptdigitaltechnologyandmoveprocessesandworkflowstothe

CX focus and confidence on the rise—especially as a brand differentiator

• Almostaquarterofmediaandentertainmentbusinesses(22percent)saidcustomerexperiencewouldbetheirprimesourceofdifferentiationfromtheircompetitorsinthenextfiveyears,almostequalwithproduct/servicequality(23percent).

• Theindustryisveryconfidentofitsabilitytodelivercompetitivedifferentiation.Despitealotofsectorsnotfarbehindat48percent,mediaandentertainmentisaheadat54percent.

Executive summary

2020DigitalTrends-MediaandEntertainmentinFocus 5

Transformative technologies are being embraced—but challenges lie ahead

• Mediaandentertainmentcompaniesfacethesamebarriersasmanyothersectorswhenitcomestocreatingdigitalexperiencessuccessfully.Thepercentagesofbusinessescitinglackofbudget(43percent),thechallengeofkeepingupwithnewtechnologies(34percent)andthedifficultyoffindingandretainingtherightpeople(30percent)areroughlythesameacrosstheentiresurvey.Butthesectorappearstostrugglemuchmorewithoutdatedworkflows,lackofseniormanagementsupport,andcross-departmentalissuesthanothersectors.

• Andit’salsolaggingbehindinitsadoptionofartificialintelligence(AI)andmachinelearning(ML).Only15percentofmediaandentertainmentbusinessesarealreadyusingAI/ML,and19%areplanningtoinvestinthetechnology.Thiscomparesto18percentalreadyusingAI/ML,and27percentplanningtoinvestinothersectors.

5

Infrastructure, strategy, and investment issues behind the confidence

• Behindthisconfidence,however,therearestillissues.Almosttwo-thirdsofmediaandentertainmentbusinesses(62percent)stillhaveeitherafragmentedapproachtomarketingtechnologyorhavelittletonocloud-basedtechnology.Thisisthesameascompaniesinothersectorssurveyed,includingretail,travelandhospitality,mediaandentertainment,andtelecommunications.

• They’realsofallingbehindinCXtrainingfortheirstaff.Almostathirdofmediaandentertainmentcompaniesprovidenolearningresourcesfortheiremployees,comparedtoaquarterofothercompanies.

• Despitethis,thesectorislesslikelytoincreasetheirinvestmentinCXtechnologythisyear—onlyathirdareplanningtospendmore,comparedtohalfofothertypesofcompanies.

2020 Digital Trends—Media and Entertainment in Focus 6

Content still reigns for business focus1

The 2020 Digital Trendsreportshowsthatcustomerexperienceisthekeyfocusformostbusinesssectorsinthecomingyear,butmediaandentertainmentcompaniesareunderstandablyfocusingoncontent,andvideocontentinparticular:

• Aquarter(24percent)ofmediaandentertainmentcompaniesseecreatingcompellingcontentfordigitalexperiencesastheirmostexcitingopportunityfor2020(Figure 1),comparedtoalmostthesamepercentageofcompaniesinothersectorswhichratedoptimizingCXasmostexciting.

• Almosthalfthemediaandentertainmentsector(45percent)expectcreatingstandoutcontenttobeoneoftheareasthatjumpsfurthestuptheirprioritylistthisyear(Figure 2).

• Asimilarpercentage(43percent)seevideocontentastheirtoppriorityforthecomingyear(Figure 2).

• MediaandentertainmentcompaniesalsoseemtobeprioritizingvideooverthestrategicbuildingblocksofCX,suchastargetingandpersonalization(21percent),customerjourneymanagement(17percent),andcustomerdatamanagement(16percent).

LastyearCiscopredictedthatvideowillaccountfor82percentoftotalglobalIPtrafficby2022,upfrom75percentin2017.1Thischangehasmadedigitalchannelsanaturalhomeforthosemediaandentertainmentbusinessesthatproducevideo.Atthesametime,it’sdriventhosecompaniesthattraditionallyspecializeinotherformats—suchasnewspaperpublishers—toaddvideototheiroutputs.

¹ “Cisco Annual Internet Report (2018–2023) White Paper,” March 9, 2020.

Figure 1: Which one area is the single most exciting opportunity for your organization in 2020?

Media and entertainment Othersectors

Creatingcompellingcontentfordigitalexperiences

24%15%

Video to increase brand engagement 15%7%

Data-drivenmarketingthatfocusesontheindividual

10%13%

InternetofThings(IoT)/Connecteddevices(e.g.,wearables,

audiencetracking)

5%3%

Using marketing automation to increaseefficiencyandyield

5%9%

Utilizingartificialintelligence/botstodrivecampaignsandexperiences

2%4%

Optimizingthecustomerexperience14%23%

Social marketing 9%6%

Reachingandunderstandingmobilecustomers

4%4%

Multichannelmarketing5%8%

Noneoftheabove7%8%

Respondents: 5,000

2020 Digital Trends—Media and Entertainment in Focus 7

Video as a multichannel tool

Whileotherformsofcontenthavetheirrolestoplayindeliveringconsumerexperience,theresearchshowsthatmediaandentertainmentcompaniesareseekingwaystoputvideoatthecenteroftheirmulti-deviceandchannelstrategies(Figure 1):

There’sabigdifferencebetweenthepercentageofrespondents(24percent)whoregardcreatingcompellingcontentfordigitalexperiencesastheirmostexcitingopportunityandthepercentagewhoaremostexcitedaboutsocialmarketing(9percent),orenthusedbyeithermobile(5percent)ormultichannelmarketing(5percent).

Byextendingtheirvideostrategy,mediaandentertainmentcompaniesareconnectingcontentwithcustomersacrossmultiplechannelsandplatforms,includingweb,mobile,andsocial.ThisviewisbackedupbyAnimoto’s2018 State of Social Marketer Trends report,2whichfoundthatvideoisconsumers’favoritetypeofcontenttoseefrombrandsonsocialmedia.

2 Megan O’Neill, “2018 State of Social Video: Consumer Trends [Infographic],” Animoto, October 23, 2018.

2020 Digital Trends—Media and Entertainment in Focus 8

Themostlikelyexplanationisthattheuseofsocialmediaisalreadydeeplyembeddedinmediaandentertainmentcompanies’communicationswithconsumers.Forexample,a2018studybyMusicWatchfoundthat90percentofsocialmediauserstakepartinsomeformofmusic-orartist-relatedactivityonsocialplatforms.3

Sowhatthisyear’sresearchindicatesisthatmediaandentertainmentcompaniesarenowprioritizingabetterunderstandingofwhatsocialdelivers,andhowthat,inturn,impactsonthebottomline.

3 Russ Crupnick, “Music Scores a Gold Record on the Social Media Charts,” MusicWatch, August 6, 2018.

Media and entertainment companies are currently still focused on content, and video is the most important content of all—partly because of its popularity with consumers, and partly because it works across all channels and platforms.

Figure 2: Which three digital-related areas are the top priorities for your organization in 2020?

Media and entertainment Othersectors

Video content 43%20%

Content marketing 30%26%

Mobile engagement and optimization

20%17%

Multichannelcampaignmanagement

15%19%

Marketing automation9%16%

Social media engagement and analytics

43%30%

Targetingandpersonalization21%28%

Customer data management16%24%

Media attribution 11%5%

Content management25%23%

Customerjourneymanagement17%26%

Conversionrateoptimization13%18%

E-commerce9%17%

Noneoftheabove3%5%

Respondents: 5,140

Media and entertainment businesses seek to understand the value of social media

Lookingmorecloselyatmediaandentertainmentcompanies’attitudestowardsocialmediathrowsupaseemingcontradiction.Toppingtheirlistofprioritiesfor2020,alongsidevideocontent,issocialmediaengagementandanalytics,chosenby43percentofrespondents(Figure 2).Thatcontrastsmarkedlywiththe9percentwhoseesocialmarketingastheirmostexcitingopportunity(Figure 1).

2020 Digital Trends—Media and Entertainment in Focus 9

2 CX focus and confidence on the rise—especially as a brand differentiator

Mediaandentertainmentcompaniesseecontentaskeyforthenext12months,buttheirviewchangesaswelookathowtheyplantodifferentiatethemselvesinthefuture.

Figure 3: Over the next five years, what is the primary way your organization will seek to differentiate itself from competitors?

Media and entertainment Othersectors

Product/Servicequality23%

18%

Customerexperience—makingtheexperienceonourpropertieseasy/

fun/valuable

22%

22%

Joininguponline/offlineexperiences—ensuringconsistencyacrossvirtualandphysicalworlds

6%

7%

Product/Serviceinnovation11%

17%

Convenience(e.g.,fastdelivery,in-storepickup,buyonlineandreturnto

store,etc.)

3%

2%

Design—making our offering differentiatedandunique

17%

9%

Mobile—catering to mobile shoppers/buyers

5%

2%

Customerservice—enhancingourreputationforbrilliantserviceacross

alltouchpoints

7%

16%

Price 2%

2%

Noneoftheabove4%

5%

Respondents: 4,680

Productandservicequalityandcustomerexperienceareseenasthekeysourcesofcompetitivedifferentiationformediaandentertainmentcompaniesoverthenextfiveyears,asshowninFigure 3(23percent).ThisviewoftheimportanceofCXmirrorsothersectorsacrossthe2020 Digital Trendsreport.

2020 Digital Trends—Media and Entertainment in Focus 10

Figure 4: Which one area is the single most exciting opportunity for your organization in 2020?

2017 2020

Creatingcompellingcontentfordigitalexperiences

23%24%

Video to increase brand engagement20%15%

Using marketing automation to increaseefficiencyandyield

5%5%

Data-drivenmarketingthatfocusesontheindividual

10%10%

Reachingandunderstandingmobilecustomers

3%5%

Engagingaudiencesthroughvirtualor augmented reality 3%

Optimizingthecustomerexperience11%14%

Multichannelmarketing6%5%

Utilizingartificialintelligence/botstodrivecampaignsandexperiences

2%2%

Social marketing8%9%

InternetofThings(IoT)/Connecteddevices(e.g.,wearablesand

audiencetracking)

5%4%

Noneoftheabove4%7%

Respondents 2017: 348 Respondents 2020: 376

Butthewaythemediaandentertainmentsector’sprioritiesarechangingcanbeseenbycomparingthe2017 Digital Trends results withthosefrom2020(Figure 4).

• Thepercentageofrespondentsratingcreatingcompellingcontentfordigitalexperiencesastheirsinglemostexcitingopportunityhasstayedalmostthesame,at23percentin2017comparedto24percentin2020.

• 20percentofrespondentsweremostexcitedbyvideoin2017.That’snowdroppedto15percent.

• 14percentnowseeCXasthemostexcitingopportunity,upfrom11percentin2017.

10

2020 Digital Trends—Media and Entertainment in Focus 11

High CX confidence across media and entertainment companies

As Figure 5shows,mediaandentertainmentcompaniesareslightlymorelikelytofeeltheyaremorematureintheiradoptionofCXthanothersectors.

• 13percentdescribethemselvesas“veryadvanced”and42percentas“quiteadvanced,”comparedto10percentand38percent,respectively,forothersectors.

• ThisisborneoutbythefactthatsignificantlyfewercompaniesinmediaandentertainmentsaytheyadoptadecentralizedapproachtothemanagementofCXthantheglobalnorm(35percentcomparedto40percent),sincesuchanapproachisahallmarkofacompanythathasyettoprioritizecustomerexperience(Figure 6).

Figure 5: How do you rate your company in terms of customer experience (CX) maturity?

advanced—our strategy andtechnologyare

well-alignedaroundCXto successful effect

Quite advanced—our strategy andtechnologyarealignedbut

CX is not fully embedded yet

Notveryadvanced—wehavesomeadhoctacticalinitiativesbutnorealCXstrategyortech

capability

Immature—wehaven’tevenstartedonthis

journey

Media and entertainment Othersectors

13% 10% 42% 35% 10%38% 43% 9%

Respondents: 5,432

2020DigitalTrends-MediaandEntertainmentinFocus 12

Product and service quality and design are also key for market standout

ProductandservicequalityisneckandneckwithCXasakeydifferentiator,chosenby23percentofmediaandentertainmentrespondents(Figure 3).Thisisfollowedbydesign,chosenby17percent.Thesefiguresarenoticeablyhigherthaninothersectors,where18percentchoseproductandservicequalityand9percentpickeddesign.

PublicationssuchasTheEconomist, The New York TimesandtheFinancial Times haveseensubscribernumbersboomasreaderslookfortrustworthysourcesofinformation.

Nooneyetknowshowmanyservicescustomerswillbepreparedtopayfor,butit’slikelythattheservicesofferingthebiggestchoiceofhigh-qualitycontentwillbethewinners.Thisalsoexplainstherecentspateofmega-mergersamongmediacompanies.

Goodservicedesign,meanwhile,iscrucialformediaandentertainmentbusinessesofferingabigchoiceofcontent.HoweasyitistofindthefilmorTVshowyouwanttowatchisakeydeterminantincustomers’perceptionoftheservice,asdemonstratedbyNetflix’spersonalisationofitshomepagebasedonindividualusers’viewingbehavior.Similarly,SpotifyhasaPremiumdesignteamresponsibleforimprovingtheuserexperienceoftheservice’s100millionPremiumsubscribers,drivingtheirlong-termengagementandmakingthemfeellikeSpotifyPremiumisabrandwheretheybelong.5

Digitalpublishersarealsoadoptingpersonalizationstrategiestodeliveramoreadaptivenewsexperiencetodrivereaderacquisition,loyalty,engagement,andretention.

Fromthisperspective,theemphasisonbothproductandservicequalityanddesigncanbeseenaspartofthegrowingimportanceofcustomerexperiencetothemediaandentertainmentsector.

The likely explanation for the perceived importance of product/service quality is what Kevin Westcott, Deloitte’s U.S. leader of telecommunications, media, and entertainment has called the “all-out streaming war” currently being waged in the U.S.4 All the big media companies are building and launching subscription streaming services, and competing for the mass audience. At the same time, digital publishers are building subscription-based services and putting premium content behind paywalls.

Media and entertainment companies believe customer experience will be equally as important as quality content in differentiating themselves from their competitors in the future. And they’re confident in their ability to deliver it.

4 “2020 Media and Entertianment Industry Outlook,” Deloitte. 5 Katie Koch, “Using Service Design to Create Better, Faster, Stronger Designers,” Spotify Design, July 11, 2019.

2020DigitalTrends-MediaandEntertainmentinFocus 13

3Putting the right infrastructure, strategy, and investment in place OR Are the right infrastructure, strategy, and investment in place?

MediaandentertainmentcompaniesmaybemoreconfidentabouttheirCXcapabilitythanthoseinothersectors,butbehindthisconfidencetheresearchshowsamixedpicture.

Media and entertainment companies are strong on CX management, but less so on execution

ThesectoriscertainlyfurtherupthematuritycurvethanothersintermsofthewayitmanagesCX (Figure 5).However,mediaandentertainmentcompaniesarenomorelikelythanthoseinothersectorstohavereachedthestageofestablishingcross-functionalteamstomanagethecustomerexperience(Figure 6).AndintermsofsupportingtheexecutionofaCXstrategy,mediaandentertainmentcompaniesare,atbest,levelwithothersectors,and,atworst,laggingsignificantlybehindthem.

• Almosttwo-thirdsofmediaandentertainmentbusinesses(62percent)stillhaveeitherafragmentedapproachtomarketingtechnology,orhavelittletonocloud-basedtechnologyatall,althoughthisfigureisthesameacrossallsectors.

• Despitethis,themarketingandentertainmentsectorislesslikelytoinvestintechnologytosupportacustomerexperience-basedapproachinthecomingyearthanothers.Only36percentofM&EcompaniesplantoincreasetheirCXspending,comparedto46percentofcompaniesinothersectors.

• ThesectorisalsofallingbehindothersinitssupportforthestaffingsideofCX.Almostathirdofmediaandentertainmentcompaniesprovidenolearningresourcesfortheiremployees,comparedtoaquarterofcompaniesinothersectors.

Figure 6: How does your organisation currently manage customer experience?

CX is decentralized across marketing and otherdepartments

Throughadigitalcenterofexcellence

Across-experienceteamorganizedaroundthecustomer

journey

An agile marketing team approachtomanageCX

Media and entertainment Othersectors

35% 44% 17% 26% 22%13% 27% 16%

Respondents: 3,114

2020 Digital Trends—Media and Entertainment in Focus 14

Despite media and entertainment companies’ confidence around delivering customer experience, they need to do more to put the necessary technology, staff, and processes in place. For many media and entertainment businesses, content is what will bring people through the door; customer experience is what will get them to stay.

TheoveremphasisonvideotoimproveCXignoresthefactthatother,morestrategicbuildingblocksalsoneedtobeputinplaceinorderformediaandentertainmentbusinessestodeliverthehigh-qualitycustomerexperiencesrequiredfordifferentiationinthefuture. As Figure 2shows,thesectorismuchlesslikelythanotherstoprioritizecustomerjourneymanagement(17percentagainst26percentforothersectors),customerdatamanagement(16percentagainst24percent)andtargetingandpersonalisation(21percentagainst28percent).

Subscription-based models replace those reliant on advertising

Allofthissuggestsasectorintransition.Ithasrecognizedthecrucialimportanceofcustomerexperienceinthelongterm,butitisstillstrugglingwiththeneedtomovetosubscriptionmodelstoreplacevanishingadrevenue.

AsMichaelBrunt,CMOofThe Economist,toldAdobe’sCMO.comsitein2017:“Wefullyexpectouradvertisingrevenuestocontinuetodecline;that’sthechallenge.Thesolutionishard,butit’stoinvestalotmoremoneyintogrowingthecirculationbusiness.”6

Andatthisstage,muchofthatinvestmentisgoingtocreateoracquirethesortofqualitycontentthatwillencourageconsumerstobecomesubscribersandthenconvincethemtostay.

6 Michael Nutley, “For the Economist’s Michael Brunt, It’s All about the Customer’s Reading Experience,” CMO by Adobe.

2020 Digital Trends—Media and Entertainment in Focus 15

4 Transformative technologies are being embraced—but challenges lie ahead

Themediaandentertainmentsectorwasoneofthefirsttofeelthefulldisruptiveeffectsoftheinternet.IntheUK,forexample,theDailyTelegraphlaunchedelectronictelegraph,Europe’sfirstdailyweb-basednewspaper,in1994.File-sharingserviceNapsterwaslaunchedin1999andchangedthemusicindustrycompletely.

Asaresult,thesectorhashadlongertoadapttotheonlineworldthanmostothers,whichmayexplainwhy21percentofmediaandentertainmentbusinessesdescribethemselvesas”digital-first,”comparedto12percentinothersectors.Evenso,mediaandentertainmentcompaniesstillfacesignificantbarriersinrespondingtoconsumerdemandforhigh-quality,consistent,andpersonalizedcustomerexperiences.

Workflow, management, and culture are bigger problems than in other sectors

As Figure 7shows,thesectorsharesmanyofotherindustries’problems:lackofbudget,thechallengeofkeepingupwithnewtechnologies,anddifficultyoffindingandretainingtherightpeople.Butitalsoappearstostrugglemuchmorewithoutdatedworkflows,lackofseniormanagementsupport,andissueswithotherdepartments.

Clearly,someoftheseproblemsarecloselylinked.InsufficientbudgetsandlackofcooperationbetweendepartmentswillstemfromthefailureofseniormanagementtounderstandandsupportaCX-basedapproach.Thisfailuremay,inturn,resultfrombusinesses’short-termfocusoncontentquality—andquantity.

Also,mediacompaniesinparticularhaveseenaproliferationofchannels,platforms,andformatsinwhichtheircontentcanbecreatedanddistributed,andtheadoptionofeachputspressureonexistingworkflows.

Figure 7: What are the top three internal barriers to successfully creating digital experiences within your organization?

Media and entertainment Othersectors

Outdatedworkflowsthatslowdownourprocesses

43%27%

Keepingupwithlatesttechnologiesand trends

34%36%

Stakeholderissueswithotherdepartments

24%17%

Other4%5%

Inadequatebudgettocreatethebestexperiences

43%45%

Lackofseniormanagementsupport26%19%

Reluctancetomovetocloud-basedstorageand/orservices

13%18%

Findingandretainingtherightpeoplewiththerightskills

30%30%

Havingtouselegacyhardwareoroldequipment

21%29%

Noneoftheabove6%6%

Respondents: 1,434

2020 Digital Trends—Media and Entertainment in Focus 16

Personalization, payment, VR and progressive web app technologies being embraced

Mediaandentertainmentbusinesseshavestartedtoincorporateanumberofnewtechnologiesataslightlyfasterratethanothersectors (Figure 8):

7 Sofie Lundberg, “These 5 Brands Aced Personalized Marketing in 2018,” Global Web Index, January 29, 2019. 8 Christine Schmidt, “Micropayments-for-News Pioneer Blendle is Pivoting from Micropayments,” Nieman Lab, June 10, 2019. 9 Joseph Lichterman, “The New York Times is Launching a Daily 360-Degree Video Series, Nieman Lab, November 1, 2016. 10 Keshav Pandey, “Successful PWA Examples of Media Industry,” Aureate, October 23, 2019.

Figure 8: Which of the following have you started to incorporate into your business?

Media and entertainment Othersectors

Deliveringpersonalizedexperiencesin real time

30%

27%

Engagingaudiencesthroughvirtualor augmented reality

17%

13%

InternetofThings(IoT)/Connecteddevices(e.g.,wearablesandaudience

tracking)

13%

15%

Blockchain-basedfunctionality6%

6%

Enhancedpaymenttechnologies(e.g.,mobilewalletsande-receipts)

21%

19%

Utilizingartificialintelligence/botstodrivecampaignsandexperiences

14%

17%

Progressivewebapps(PWAs)15%

13%

Voiceinterfaces(e.g.,AmazonEchoandGoogleHome)

10%

8%

Other1%

2%

Respondents: 4,773

• Justunderathird(30percent)haveintroducedreal-timepersonalizedexperiencesintotheirmarketing.Forexample,Spotify’s#2018Wrappedcampaigndeliveredanindividualend-of-yearround-upofeveryuser’slisteninghabitsfortheyear7.

• Justoverafifth(21percent)areincorporatingenhancedpaymenttechnologies.Intheworldofpublishing,forinstance,DutchdigitalnewsaggregationserviceBlendlelaunchedwithapay-per-articlemodelin2014.However,thecompanyrevertedtoasubscriptionservicelastyear.8

• Some17percentarestartingtouseARandVRtoengageaudiences.Forexample,The New York Times sent 1 million Google CardboardVRheadsetstosubscriberspriortothelaunchofitsNYTVRappin2015.9

• Some15percenthavestartedtoadoptprogressivewebapps(PWAs)tohelpaddressproblemsincludingslowloadingtimesfornewssites,slownetworks,andthedisruptivenatureofadsonmobile.TheWeatherChannelandForbeshavehadnotablesuccesswiththeirPWAlaunches.10

2020 Digital Trends—Media and Entertainment in Focus 17

Is AI adoption sufficient for success?

Oneareaoftechnologywherethemediaandentertainmentsectorislaggingbehindisinartificialintelligenceandmachinelearning(AI/ML).Theresearchfoundthat15percentofmediaandentertainmentbusinessesareusingAI/ML,butonly19percentareplanningtoinvestinthetechnology(Figure 9).Thiscomparestoothersectorswhere18percentarealreadyusingAI/ML,and27percentareplanningtoinvest.

Figure 9: Is your organization using or planning to invest in artificial intelligence AI/ML in 2020?

Media and entertainment Othersectors

Yes,wearealreadyusingAI/ML

15% 18%

Respondents: 3.024

Yes,weareplanningtoinvestinAI/ML

19% 27%

No,wehavenoplanstoinvestinAI/ML

66% 55%

2020 Digital Trends—Media and Entertainment in Focus

2020 Digital Trends—Media and Entertainment in Focus 18

Emerging technologies such as enhanced payment methods, AR/VR, and progressive web apps are starting to appear in M&E companies’ toolboxes, but the sector is lagging behind in its adoption of artificial intelligence and machine learning.

Figure 10digsintothereasonsbehindthisreluctance:

• Almosttwo-fifths(38percent)ofM&EcompaniessaidtheyhadnoperceivedneedforAI/ML.

• Athird(30percent)lacktheresourcestoadoptAI/ML.

• Athird(30percent)feelthattheirorganizationisnotmatureenoughtocurrentlymakeeffectiveuseofAI/ML.

• Almostathird(28percent)lackknowledgeabouthowtheycoulduseit.

• Thesamepercentagesaytheyhaven’tevenassessedhowtheycoulduseit.

ThislackofactionisallthemorestrikingbecauseofthegrowinguseofAIinkeyrolesinboththeproductionandconsumptionof video.11It’salreadybeingusedtoautomaticallycreatesportshighlightpackagesfromrawfootageatWimbledonandtheU.S.Masters,whileNetflix,forexample,usesAItopersonalizeitshomepageforeachindividualuser.

AI/MLarealsoacrucialelementinpredictiveanalytics,thetechnologythatallowsmarketerstoautomaticallytakethebestactionforeachindividualcustomerateachstageintheirjourney(whilehonoringuserchoice),toencouragethemontothenextstage.It’sthebasisofthemassreal-timepersonalizationofmarketingmessageswhichathirdofmediaandentertainmentcompaniesclaimtohavebeguntoimplement(Figure 8).BecauseAIsystemslearnfromthedatathatresultsfromthedecisionstheymake,earlyadoptersinthisarewilltendtomoveaheadoflaggardsatincreasingspeed.Thismakesitessentialforthetwo-thirdsofmediaandentertainmentcompaniesthathavenoplanstoembracethetechnologytoreconsidertheirposition.

11 Rob Van Den Dam, “The Future of Video Is Here—and It’s Driven by Artificial Intelligence,” LinkedIn article, April 17, 2019.

Figure 10: Why is your organization not using or planning to use AI?

Media and entertainment Othersectors

Noperceivedneed38%45%

OurorganizationisnotmatureenoughtomakeuseofAI

30%31%

Currentsolutionsaretooexpensive20%18%

Lackofhigh-qualitydata7%11%

Lackofresource30%28%

Wehaven’tassessedhowwecoulduseAI

28%38%

Current solutions are not advanced enough

9%8%

Lackofknowledgeonhowwecanuse it

28%31%

AmountoftimerequiredtotrainAIsystem logic

11%11%

Dataintoomanylocation/notaccessible

7%9%

Other3%3%

Respondents: 1,644

2020 Digital Trends—Media and Entertainment in Focus 19

Three key takeaways for media and entertainment sector marketers

1. Mediaandentertainmentcompanieswillneedtoincreasetheirinvestmentinboththetechnologyandthestaffrequiredtosupportthemovetoamorecustomerexperienceapproach.

2. Theywillalsoneedtoaddresstheirboards’levelofCXunderstandinginordertoreleasethebudgetandbegintheorganizationalchangerequiredtotransformthecompany.

3. AIisemergingasakeytoolinboththecreationandthediscoveryofcontent.Mediaand entertainmentcompaniesneedtoshakeofftheiranimositytoitandstartworkingoutwhatbusinessvalue it can deliver.

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Conclusion

2020 Digital Trends—Media and Entertainment in Focus 20

2020 Digital Trends—Media and EntertainmentisbasedonanonlinesurveyfieldedtoselectAdobeandEconsultancylistsinthefourthquarterof2019.Thesurveyclosedhavingcollected564qualifiedclient-sideresponsesfromthemediaandentertainmentsector.

Demographic profiles

• Seventy-sevenpercentofalltheresponseswereatmanagerlevelorabove.

• Intermsofbusinessfunction,creative/designheldthelargestshareofrespondents(48percent),followedbycontent/editorial(12percent),marketing(11percent)andadvertising(6percent).

• Asdefinedbytargetmarket,thoseaddressingbothmarketsequallyaccountedforthelargestshareof46percentfollowedbyB2C(35percent)andB2B(19percent).

• Thesampleisglobal,withtheUnitedStatesprovidingthelargestshareofrespondents(42%),followedbyEurope(29percent)andtheAsia-Pacificregionat19%.ThesurveywastranslatedintoFrench,German,Chinese,andJapanese.

Methodology

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2020 Digital Trends—Media and Entertainment in Focus 21

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