Here you will find a snapshot of the major trends in the UK entertainment and media industry from both an advertising and consumer perspective along with our predictions for the next 5 years.
In our 2016 Global entertainment and media outlook, we predict the UK sector will grow at 3% per annum over the next 5 years to be worth £68.2 billion by 2020, overtaking Germany in 2017 to become the largest market in EMEA.
Advertising revenues are driving this growth, as the industry identifies new ways of measuring and tracking performance in a connected, mobile and digital world.
Whilst we predict digital revenues will overtake traditional revenues in the entertainment and media sector as a whole in 2019, not all sectors are at the same stage of digital maturity.
Global entertainment and media outlook
Consumer spend on entertainment and media will grow at 1.2% per annum over the 2015-2020 period, however this masks a 9.2% increase in demand for digital products and services.
Consumers’ love of TV and video continues and will account for over 35% of their spend in 2020. With 80% of UK adults watching an online TV / film service in 2015 the UK leads adoption of online viewing.
Consumer spend on digital books, magazines and newspapers will all see double digit growth year on year over the 2015-2020 period. The video games market will see digital console game revenues (including online micro-transactions) growing at 11% to overtake the digital PC game sector in 2019.
Understanding how consumers are spending their time and money in the entertainment and media industry can help to inform strategic business priorities of big brands, media companies and advertising agencies.
Smarter, platform specific, targeted digital advertising and innovative use of technology is delivering value to the consumer and growth in the sector.
2016 is a watershed year for the advertising sector, as we predict digital revenues will grow at 10.7% per annum to 2020, overtaking non digital revenues for the first time. This reflects the volume and growth of the internet advertising sector which will be worth £13.7bn in 2020.
Mirroring consumer demand, television will be the fastest growing digital sector, with digital advertising revenues growing at 19.6% per annum to 2020 taking advantage of the opportunities afforded by on-demand viewing.
Digital out of home advertising revenues will overtake traditional spend in 2020, with a growth rate of 15% per annum over the next 4 years, as smarter, interactive billboards become mainstream.
Internet access combined with tablet and smart phone penetration has created a golden age for individuals interacting with media and the appetite of UK consumers shows no signs of slowing.
Broadband penetration is predicted to reach 95% in the UK in 2020, with over half of these households receiving high speed access. Mobile internet penetration will reach 90% in the same year. 20bn apps will be downloaded in the UK in 2020, accounting for 5% of the world’s app market with 88% of smartphone and tablet data usage spent watching video content.
The UK entertainment and media market will grow at 3% per annum over the next 5 years to be worth £68.2 billion by 2020, overtaking Germany in 2017 to become the largest market in EMEA.
Digital spend in the UK entertainment and media sector will overtake traditional spend in 2019, growing at 7% while traditional spend declines at 0.5% over the 2015-2020 period.
Growing at 15% per annum, digital out of home (OOH) advertising revenues will overtake traditional revenues in the sector in 2020 as the industry embraces the interactive, flexible two way interactions afforded by digital.
The internet advertising industry “cuts the cord” as they embrace mobile. The mobile internet advertising sector will grow at 22% over the next 4 years and will account for 50.6% of the market in 2020.
To survive the rapid transition to a direct-to-consumer future, companies across the E&M sector need an effective fan-centric strategy — or risk decline and irrelevance.
You hear it called the digital revolution - the transformation of how we work and live, which is one of the great megatrends we believe will shape the world in the 21st century.
Articles on strategies that work, building engagement and loyalty and interviews with Sir Martin Sorrell, CEO of WPP and Carolyn Everson, President of Global marketing solutions at Facebook.
Phil StokesEntertainment & media leader
Tel: +44 (0)207 804 4072
Mark MaitlandPartner, TMT Strategy
Tel: +44 (0)207 804 7153