Consumer Spending on Digital Media to Rise
In the early days of the transition from traditional to digital content, providers made a significant amount of information available to consumers for free. The logic behind the decision was all about an ad-supported delivery model. Other producers aimed to hook the audience on limited free content and then encouraged users to update to a paid subscription. According to new PQ Media data, consumers are growing accustomed to the idea of paying for their online content and the devices that allow them to access the information, a trend that bodes well for producers, media sellers, and marketers.
Globally, consumer spending on digital media content and technology reached $860.39 billion last year. Analysts compute the per-consumer spending at $161.83 annually. This level marked a compound annual growth rate of over 14% in the last 5 years. By comparison, consumers increased spending on traditional media by only 1.4% annually, or a total of $3, during the same time period. In 2013, we should see another spending boost of 11.9% and by 2017, global spending will reach $1.44 trillion as consumers purchase more subscriptions, tablets and smartphone data plans.
While Millennials, digital natives, will contribute to the growth, the increasing purchase power of the rising middle class in places like Brazil will play a role. In South Korea, for example, over 84% of spending on content will be for digital. In the U.S., per-consumer annual spending of $259.48 on these products and services is expected by 2017.
Industry segments with spending exceeding the $50 billion mark include:
- Broadband and wireless data subscriptions
- Digital games and apps/microtransactions
- Laptops and notebooks
Marketers should be rolling out their digital campaigns to capture the attention of consumers in transition.
To learn about a specific audience in this sector, such as smartphone app purchasers, check out the AudienceSCAN report available on the Research Store at ad-ology.com.