Adapting to the new normal: Long terms effects of the coronavirus on broadcasters
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Deserted streets and empty offices are just one impact of the global coronavirus crisis. The pandemic is significantly affecting all manner of business activity and the broadcast industry is no different. We have already experienced seismic changes in audience content consumption, shifting from stadium entertainment and live sports to bedroom broadcasts and eSports. During times of crisis, advertising and marketing budgets are among the first to be slashed, meaning many companies are now pausing, shrinking or rethinking their advertising spend.
In a time of uncertainty and fear, consumers want to stay connected, entertained and educated, resulting in shifting behaviors and beliefs. In order to meet these new consumer demands, broadcasters need to adapt their strategies in both the short and long term—it’s all about interactivity and engagement across digital platforms.
Hunkering down with online content
In a socially distanced world, where human beings need connection more than ever, home entertainment has soared. A report released by Nielsen revealed that Stay at Home policies lead to almost a 60% increase in the amount of content watched by consumers. Global streaming also increased by nearly 21% during the first three weeks of March, highlighting the immediate impact the coronavirus has had on consumption patterns. This isn’t just the case for drama-fueled streaming platforms; weekly viewership on Twitch is up by a full 10%.
At a time when audiences have never been more digitally connected, it’s no surprise that social media consumption has also boomed. Facebook video views have increased by 247%, with YouTube viewer engagement improving by 50% in the last month, demonstrating that as consumers aren’t able to interact in real life, they’re engaging more online.
Take a look at any family Zoom call, or network of friends on a Hangout—people want to get up close and personal with their screens. These shifts in behavior offer expansive opportunities for broadcasters to create a lifeline to those at home. A stream no longer has to be a one-way flow of information—with a simple touch of a screen, the audience should be able to engage with content and make watching an immersive experience. There has never been a more prominent time for streaming services to start gathering audience data and understand both what they want to watch, and how it leads them to better engage. Using data to personalize viewing experiences means these broadcasters can push relevant and contextual information to help audiences get the best out of their video in both the short and long term.
Calling half-time on live sports
Venue-based entertainment has also been notably impacted by our new normal. Formulated on live competitions with large crowds coming together to spectate, sports has taken the hardest hit: it was one of the first sectors to respond to the pandemic by playing games behind closed doors, before ultimately, postponing or stopping events altogether. With the list of canceled sporting events growing each day, we can expect to see the standstill extend further than we first thought.
Many of us are feeling the absence from the lack of live sports entertainment, creating opportunities for broadcasters to experiment with digitizing their content in new ways. These companies are exploring archived content over OTT and VOD platforms to create revised content in the short term. This is complemented by virtual tournaments and interactive content, allowing audiences to vote in a poll, sign up for a service or provide commentaries. Not only does this encourage longer viewing times, but it also improves engagement, during this unprecedented time when consumers crave connections.
The interlude in live sports offers a period of reflection for broadcasters and the chance to realign or strengthen digital strategies. Backyard sporting fixtures and amateur eSports are encouraging local participation and fostering neighborly interest in local rather than national talent. However, we are still hopeful for a return to the major leagues. In a recent survey conducted by BCW Sports Practice, 58% of respondents believe that the virus outbreak will have a low impact in 2021, as live events will bring people back together en masse—but by then new behaviors of consumption are likely to be well established. Therefore, digital innovation will continue to be critical in supporting the return to industry, by nurturing fan engagement to keep spectators coming back for more.
Realigning advertising spend
With many people self-isolating at home, consumer buying has dramatically decreased—with the exception of the bare necessities. This is leading to a plummet in advertising spending, with 46% of IAB Proprietary Research respondents stating that they are adjusting advertising spend for the rest of Q2. The impact from postponed or canceled events, such as the Olympics, with their unparalleled ability to reach engaged audiences at scale, can only be imagined at this stage.
In order to survive, advertisers must turn to innovative strategies that will help market their products. As more people are settling down with home entertainment during this crisis, their advertising spend should focus on online, streaming platforms and social media. The results from a recent survey with Advertising Perceptions supports this, with only 21% of respondents stating that they are pulling or pausing OTT and connected TV advertising budgets.
Despite the inevitable impact on the advertising industry in the short term, companies should consider maintaining advertising spend and take advantage of digital opportunities to adapt to the new environment. This is reinforced by IAB Proprietary Research, which suggests we can expect a faster rebound on digital advertising in Q2. Therefore, by using available technologies intelligently and addressing the challenges head-on, these broadcast and advertising companies will be the front runners in the post-pandemic market.
Preparing for the new normal
The new normal is well on its way and broadcasters need to adapt to withstand the long term effects of the coronavirus. The key is to capitalize on the opportunities created by digital platforms to improve interactivity and boost engagement with consumers. With the continuous rise of video streaming and online consumption, broadcast companies can get up close and personal with their audiences to create memorable experiences over OTT and VOD platforms. Not only will this fill the hole left from the absence of live sports but also will create a lifeline to those who need it the most. The current crisis is unavoidably going to change the broadcast industry in 2020, but we can take action and make the most out of the evolving landscape.
After all, we are all streamers now.