If consumers access lifestyles instead of buying products, what is the future?

By

Janet Balis

EY Global Media & Entertainment Advisory Services Leader

Transformation leader in media and marketing. Innovator. Digital native. Change agent. Passionate advocate for women and gender parity. Influencer. Mother.

6 minute read 10 Oct 2018

Will Black Friday still be a big retail event in 2030? Our hypothesis is that people will buy and own fewer things. Explore how brands can reposition themselves for success.

FutureConsumer.Now is a look at customer experiences and how they will evolve and transform our world over the next 12 years. If you don’t think it will be dramatic, take a look at the changes over the last 12 years and know the rate of transformation will compound exponentially due to innovation and new technologies. Consider our hypotheses about life for 2030.

Consumers will own fewer things

Instead, they will pay to use or access what they want, whenever they need it. Lifestyle subscriptions and services will increasingly replace product ownership. A thriving sharing economy underpins this shift, with an increasing emphasis on new forms of community, demand-led economies of scale and new combinations of physical or virtual service elements.

Location-aware services will enrich physical experiences (e.g. sports, music, experiential events) driving deeper personalization and unlocking new business models. While the online world has largely existed in parallel to the physical world, we will quickly see experiences cross the physical-digital divide. Content and entertainment will become ‘mobile first,’ with services customized and aggregated depending on the user’s location.

Right now time-shifted content is the norm, but place-shifted content (content stored on one device, but accessed from another) will be the prevalent by 2030.


Brands will need to build relationships with consumers in new ways

Traditional interruptive, untargeted advertising will decline, giving way to new opportunities for branding as more experiences and surfaces become digital and ad-supported in highly targeted ways. Storytelling techniques will be enhanced by innovative new formats such as VR and AR, which will continue to evolve. Brands will need to continue telling stories, leveraging technology and data to distribute new content, as part of organic experiences that are more relevant to consumers.

Service personalization has been a feature of TMT (Technology, Media & Entertainment and Telecommunications) services for many years. However, predictive analytics will help to match user preferences with products in new and exciting ways, helping to meet as yet unmet and unarticulated needs. A deeper, more granular set of data about all aspects of consumer behavior and desires will further enable a more unique, anticipatory digital experience. The biggest challenge however, will be bringing data and analytics to a state where the information can be aggregated, analyzed and mined for truly actionable insights in real time.

Consumers will become even more aware of the value of their personal data

Consumers will have the means to monetize their own data, or at least control it far more directly and transparently. Rules regarding consumer protection and data privacy will continue to evolve and dictate the pace of innovation in this value exchange. Interactions that prize transparency allied to consumer consent and control will set a new benchmark for trust. This will also set the tone for how different industry ecosystems come together, with data protection and privacy issues top of mind for all. New business models that leverage more granular data will emerge, supported by new value chains that process this data but a quickly changing regulatory environment will be a critical constraint to manage.

We will see cross-vertical sector convergence

As the landscape of the user experience changes, it will become increasingly important for TMT companies to tap into the broader ecosystem of brands with strong consumer relationships to curate their lifestyles. Companies will no longer be siloed within their individual industries (media, healthcare, automotive, etc.). They will be challenged to focus on a more integrated customer experience with access to personal preferences and habits.

These experiences will enable greater access to consumer data, and converged, ecosystem-wide collaboration will be required. The constructs TMT companies use to define their competition and partners today will be challenged to include collaboration across content creators, distribution opportunities, brands and surrounding industries to create interoperability and build scale to thrive in the future.

What are media and entertainment companies saying?

To position themselves for success, media and entertainment companies must look at their breadth and depth of offerings, building scale and developing the content, distribution and monetization stack of the future. Horizontal integration will enable efficiencies of scale, but vertical integration will be critical across content, data, distribution and monetization. New business models will be critical, including a data-driven approach to direct-to-consumer business models.

Looking at the new generation of successful media companies today, we see their control of customer data as crucial to designing these compelling experiences that drive their overall success. Over time, this will become more relevant and influential as those experiences evolve. Data will never be in short supply, but harnessing its power will likely be underestimated in its complexity and required commitment.

Media and entertainment companies will be required to bundle their content in new ways, engaging with a wider ecosystem to achieve the holistic integration necessary to meet consumer expectations. Automotive manufacturers, retailers, utility companies – almost all sectors can be engaged to ensure that the delivery of content creates new elevated experiences – for example, using the car as an entertainment medium, exploiting opportunities in the smart city environment, or thinking about bringing commerce and advertising together in new ways. All of these efforts will exponentially enhance how consumers live in the future.

  • Methodology

    Through research and interviews with global innovators, futurists, business leaders and our own professionals, EY has identified over 150 drivers that could shape the future consumer.

    We used those drivers to create eight powerful hypotheses, each of which relates to a key aspect of the future consumer: how people will shop, eat, stay healthy, live, use technology, play, work and move.

    We then held a series of hackathons and innovation workshops around the world to explore these hypotheses further and to imagine the future worlds they might create.

Summary

As they seek out this horizontal and vertical scale, media and entertainment companies must fundamentally prize creativity. Their strategy may be executed through their own means or by connecting more effectively with a broader ecosystem of other companies in media, technology, telecoms and beyond. The journey may be very different for each company but the end game is, at its core, about scalable, innovative brand experiences.

About this article

By

Janet Balis

EY Global Media & Entertainment Advisory Services Leader

Transformation leader in media and marketing. Innovator. Digital native. Change agent. Passionate advocate for women and gender parity. Influencer. Mother.