MAD Perspectives Blog

 Convergence Creates Opportunities

Peggy Dau - Monday, July 15, 2013

Any time industries converge new opportunities arise. Nothing surprising about this. As TV consumption continues to shift towards viewing on mobile and tablet devices, opportunities arise all along the value chain for managing, delivering and monetizing that content. Of course, revenue is the goal for content providers, and the key barometer for success is revenue, which is still primarily tied to advertising. Sure, Hulu, Amazon, Netflix and others can charge a monthly subscription, but that is a small portion of the revenue surrounding televised content.

As content is distributed in a non-linear fashion, new opportunities exist for brands, advertisers and technologists. As second screen TV augments the TV viewing experience, content providers provide new opportunities for brands and advertisers. Industry watchers such as Nielsen, eMarketer, PWC and others, all agree that consumers are social while enjoying their favorite TV programs. They also agree that this social activity is enable by mobile devices such as smartphones and tablets. As a result, Zenith Optimedia predicts mobile advertising growth from $8.6B in 2012 to 29.4B in 2015. This represents significant growth from 1.8% to 6.1% of global advertising spend.

This revenue growth will drive technology investments to enable improved back-end content management, creative workflows and data analysis - all with the goal of driving greater consumer engagement and interaction. Creative minds will develop complementary marketing programs leveraging alternate channels. The New York Times recently shared its plans for an in-app mobile ad experience to promote Showtime's original series Ray Donovan. The ad includes a show trailer allowing viewers to tap on the trailer to obtain further information about the program.

This innovative approach represents the flexibility allowed by new devices, new consumer behaviors such as tapping a screen and integration of technology, promotion and brand.  As a result of its focus on fan engagement, second screens provide the data necessary to justify brand investment. As the second screen nurtures conversations around televised content, it also capture data reflecting sentiment, demographics, fan desires and actions taken. This data is the goal for media properties, enterprises and brands as they explore the use of social and/or mobile solutions for connecting with target customers or consumers. This data drives revenue for content providers as they pursue brands and advertisers, but it also drives revenue for technology firm with solutions for data capture, analysis and storage.

All along the value chain, new opportunities are emerging. It may be the telecommunication network that enables online or mobile connectivity, or the tablet manufacturer and their app store, or the data analytics software that uncovers the meaning behind all our social conversations. Each of these companies is capitalizing on the opportunity presented by market convergence. As magazine publications create enhance their online presence with video or enterprises create digital channels to improve brand awareness, it is the convergence of technology and market demand, in an increasingly digital society, that is creating opportunities for improved revenue, customer experience and brand awareness.

What's your perspective?