Mobile 2019: Emergence of ‘I-Me-Mine’ content Consumption Phase

India’s data usage on mobile is now at par with developed markets at 8 GB/month/subscriber (Source: ‘Unlocking Digital for Bharat: $50B Opportunity’: Bain & Company, Google and Omidyar Network). As per industry stats, on an average 40 million new users are coming online every year, and there has been 4X growth in rural internet users since 2012.

These highly engaged users are redefining India’s mobile internet landscape. Consumer engagement analysis proves that voice, video, & language are three big consumer trends that marketers need to pay attention to.

Mobile, of course, is playing a pivotal role in it. With the increase in consumption of content and transactions over the mobile, mobile web is increasingly becoming an integral and critical part of brand interaction.

Ashish Pherwani

To what extent would mobile emerging as medium of choice impact other media in the next year or so remains to be seen. Ashish Pherwani, Partner and Head, Advisory, Media and Entertainment, Ernst and Young states, “Television and print would continue to be the largest segments in 2020, followed by digital media and then film.” He adds, “Growth of digital revenues would be driven by the emergence of the 2nd screen, which would increasingly be used to consume content currently on traditional media, be it movies, episodic content, news, games, etc.  This is witnessed by the increased 2nd screen interactivity seen across KBC, IPL etc. The mix of content consumption would change to reflect increased individual consumption as compared to group consumption. We are moving into the ‘I – me – mine’ phase of content consumption.”

An outcome of the changing content consumption habits is consolidation in the media space and emergence of telcos as the content providers too. Lage media agencies buying digital ones is also being seen. Narayan Ivaturi, Vice President, FreakOut expresses, “I can foresee a substantial amount of consolidation in the media industry by 2020. We have already seen examples of large telco companies investing into or outright buying media companies and I expect the trend to continue. Moreover, 2020 will truly be the year for emerging markets like India, South East Asia, Latin America and parts of Africa. Evolved markets like the US are already showing sluggish growth figures, and clearly the focus of many media / adtech companies will be on emerging markets.”

Interestingly rapid growth of mobile content consumption in not only an opportunity facilitator but has thrown up many challenges too. The industry is optimistic about high RoI but in many cases reworking both their content delivery and revenue models might be the need of the hour. Pherwani states, “The customer lifetime value equation is difficult to balance, as in most cases, customer acquisition + content costs are higher than revenues earned; hence partnerships and innovative marketing approaches are the key to success.” He continues, “In addition, most businesses would need a robust subscription model alongside advertising to succeed in the long run.  OTT subscription revenues grew 50% from Rs 260 cr in 2016 to Rs 390 cr in 2017 and have already more than doubled that in 2018.”

Narayan Ivaturi

At the device level, mobile, as is obvious will further strengthen its position as the primary device for the consumer and ad spend will significantly gravitate towards mobile-first opportunities. Ivaturi points out, “In the near future, AR and VR would become more of a norm. At a stack level, programmatic will represent at least 50% of the business globally and will drive better efficiencies to the advertiser. My concerns remain on data and how data will be utilized in the absence of concrete privacy laws and data quality. Blockchain will further make way into the media world with more and more media companies using the technology for all or some part of their product stack.”

Interestingly rapid growth of mobile content consumption has provided immense opportunities, but it has thrown up many challenges to the marketers as well. The industry is optimistic about high RoI but in many cases we might see them reworking both their content delivery and revenue models. Pherwani states, “The customer lifetime value equation is difficult to balance, as in most cases, customer acquisition + content costs are higher than revenues earned; hence partnerships and innovative marketing approaches are the key to success.” He continues, “In addition, most businesses would need a robust subscription model alongside advertising to succeed in the long run.  OTT subscription revenues grew 50% from Rs 260 cr in 2016 to Rs 390 cr in 2017 and have already more than doubled that in 2018.”

The year passing by can truly be defined as the year of mobile explosion in India, with rural and regional markets leading the way. It has also been the year where programmatic moved from experimentation to mainstream digital/mobile advertising. Ivaturi states, “With regard to mobile, 2018 is clearly the year of Programmatic. Most advertisers and agencies moved significant amounts of their mobile budgets onto programmatic platforms. Some outstanding quality work has been happening on mobile platforms with creative tools developing some amazing customer ad experiences. Retargeting has been used significantly in 2018 - not just for performance advertisers but also for brand advertisers. This has created the ability to distinctly tell high quality stories via video. 2018 also saw a significant increase in mobile video consumption and as a result, increased advertising opportunities.”

Come 12 December, we would have a much better picture as to whether mobile is already emerging as the screen of choice, or there is still time for that; whether mobile would deliver more premium content or mass, whether the current revenue models rule the roost or if telecom operators would manage to drive the growth.

Be a part of TMMS 2018 and watch the future unfold itself.