For the first time social reviews and recommendations have outstripped TV advertising in terms of their influence on buying decisions according to a new study by Deloitte.
Social media is also now the dominant force across media consumption behaviours, according to the fifth edition of the consultant’s Media Consumer Survey.
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“It is not only impacting our entertainment preferences and how we consume news, but for Immersive formats and new technologies such as Virtual Reality (VR), along with the ability to curate, stream and pay for content to avoid adverts, are also influencing our habits, seeing us more immersed and paying more attention,” said the authors.
The study also dives deeply into the distinct media consumption habits of Millennials.
The report reveals that 84 per cent of local consumers engage with social media networks, with two thirds interacting with social media every day and a little over a quarter of those surveyed checking their accounts four or more times a day.
According to Deloitte Digital Strategy Leader and co-author of the report, Niki Alcorn, “Not only has social media become an entertainment activity in its own right, it is now our number one digital destination.”
“We spend 21 per cent of our digital entertainment time on social media – creating, reading or commenting on content, uploading photos and videos or writing reviews – with women spending slightly more time (25 per cent of their digital entertainment time) in social domains than men (17 per cent),” Alcorn said.
Who told the oldies?
Deloitte found that the fastest rise in usage of social media over the last five years has been amongst Boomers and Matures. But as they arrive, the younger generations are moving on.
According to Alcorn, “92 per cent of survey respondents are on Facebook. But as all age groups converge at this destination, Millennials are heading to newer, more mobile and image focused networks, such as Instagram and Snapchat. Snapchat is almost exclusively being used by Millenials, with usage dropping away significantly over the age of about 30.”
“Disposability of content also plays a role in this shift, the younger generations are enjoying real-time shared moments with the benefit of more private content that doesn’t live on in perpetuity online,” Alcorn said.
Stop the presses, seriously
The proportion of survey respondents using social media as their primary source of news has doubled to almost 1 in 5 (up from 9 per cent in 2015), and this now outstrips the frequency with which we use newspapers – both online and print.
And among Millenials, social media is now the primary source of news.
Alcorn said that while word of mouth remains the primary influencer on purchase decisions for three quarters of respondents, we have reached the tipping point for the digital equivalent.
She said 58 per cent of respondents ranked ‘reviews from people within their social media circles’ in their top three influencers for buying decisions compared to only 55 per cent who ranked television adverts.
“This is the first time this has happened – and notably the influence of advertising on purchase decisions has fallen for the first time in four years. Adverts on social media are also influencing us more than ever, with a 17 per cent CAGR increase over the last four years in people’s perceptions of them having a high or medium influence on their purchasing decisions.”
TV still No.1 for viewing
Using the internet (up to 60 per cent in 2016 from 47 per cent in 2012) is on par with watching TV as our number one entertainment activity. But despite the plethora of devices, platforms and options available to us, live TV is still our preferred viewing method, accounting for 42 per cent of total viewing time.
Deloitte Financial Advisory Leader Clare Harding said: “TV may still be number one, but streaming is hot on the heels of live programming, accounting for almost a quarter of our viewing time, up from 18 per cent last year.”
Users actually pay
Subscription video on demand (SVOD) hit the Australian market in a big way with the introduction of three new services last year. This is reflected in the survey, with the number of people paying for SVOD almost doubling since 2015, up to 22 per cent.
“It’s still early days for SVOD in Australia, with respondents experimenting with what these subscriptions have to offer. In order to access their desired content, 18 per cent of SVOD subscribers have more than one service, with two-thirds of multi-subscribers expecting to maintain two or more services in the future,” said Harding.
Video is not the only content we’re willing to pay for in order to get what we want. The majority of us remain reluctant to pay for online news subscriptions – just 9 per cent are willing to do so, which has been stable over the last three years.
When consumers are willing to pay, however, it’s because they are looking for more in-depth news analysis (52 per cent). This desire for more detail has increased significantly from 33 per cent last year, replacing ‘trust and association with the brand’ as the most compelling reason to pay.
Harding also said that while more of us are choosing to pay for the content we want, we’re still multi-tasking, in fact more than ever.
“88 per cent of us are multi-tasking whilst watching TV, up from 60 per cent in 2012. Having said that, either because we’re more immersed in the content or because the smartphone does so much for us, we are using fewer devices when multi-tasking – down from two to one this year.”
According to Harding the uptake of SVOD subscriptions shows an increased comfort in paying for video content, which may be influencing our multi-tasking behaviours. 70 per cent of respondents believed they pay closer attention to content that they have paid to watch.
Bad news for Mad men
Consumers are also revealing a willingness to pay for ad free content.
According to Harding, “People not only want the freedom to choose the content they watch, they are willing to pay for it to enjoy an advert free viewing experience.” 48 per cent reported they would pay to watch movies in exchange for not being exposed to adverts, while 43 per cent would pay for TV shows to avoid them.
“When it comes to streaming services, respondents’ willingness to view adverts is diminishing (50 per cent in 2016 down from 58 per cent in 2015), even if it significantly reduced the cost of the subscription,” Harding said.
He said that in the digital domain, adblockers give consumers the power to shut out ‘interruptions’ and 28 per cent of respondents reported using ad-blocking software.
Advertising remains a key influencer of our buying decisions, although the channels of influence are changing.
TV advertisements have fallen in the rankings for the first time in four years, with 55 per cent of respondents this year perceiving them to have a high or medium influence on buying decisions, compared to 63 per cent last year.
“And in the growing digital advertising market, social platforms for the first time are seen as being as influential as search, with 40 per cent of respondents identifying these among digital advertising channels as having the greatest influence on their purchasing decisions,” said Harding.
Millennials are shaping future media consumption behaviours
Looking to where our preferences may head, all eyes are firmly on Australia’s largest demographic – Millennials.
“Millennials are traditionally early adopters when it comes to technology, which in turn shapes their media consumption behaviours. We’re definitely seeing this reflected in this year’s survey, with higher rates of bingeing, multi-tasking and moving to devices other than the TV to consume content,” said Deloitte Telecommunications, Media and Technology Leader, Stuart Johnston.
Millennials are leading the social media revolution, their use outstripping all other age groups, with 84 per cent of Leading Millennials (27-32) and 77 per cent Trailing Millennials (14-26) being daily users of social networks.
29 per cent of Millennials use social media as their primary source of news, compared to only 12 per cent of other respondents. This trend is now starting play out among other generations. 20 per cent of Gen Xers said they use social media as their primary news source this year, compared to just 6 per cent in 2015.
Millennials are also leading the uptake of SVOD services, with 35 per cent subscribing to a streaming service compared to 14 per cent of other respondents. Across the board a higher proportion of bingeing occurs amongst those with SVOD subscriptions, with 74 per cent of Millennials bingeing compared to 50 per cent of other respondents.
“If other age groups continue to follow Millennials’ lead we will find ourselves being entertained more on the internet – already the number one entertainment activity for Millennials. And when we are watching TV content it will more likely be via a streaming service than live programming, with 32 per cent of Millennials preferring this method compared to 16 per cent of other age groups,” said Johnston.