As we move through 2020, what might affect what we’re thinking as marketers? How are consumer behaviors changing?
There are a number of technological advancements driving change:
1. Voice Technology and Voice Search
The number of smart devices continues to grow. Smart speakers have been one of the quickest adoptions to new technology of any device introduced in years. This is partly due to falling costs and partly due to the fact that consumers have already become comfortable talking to smartphone assistants like Siri. Over 100 million smart speakers have been sold to date.
While Amazon remains the leader with its Echo brand, Google has started to catch up and has introduced many new devices, including a number with built-in video technology. High-fidelity speaker brands such as Sonos and JBL have also become strong sellers to consumers who seek better audio quality throughout the home without the need for installation. While Apple has only begun to enter the smart speaker market with a Siri-voiced product, given Apple’s brand power and strong cash flow, it’s hard to rule them out.
Beyond the entertainment offered by these new devices, the rise of voice search represents a significant change in consumer behavior and revenue at Google and Amazon. While the majority of searches don’t currently involve commerce, voice-based shopping is expected to jump to $40 billion by 2022. Today, 20% of all searches are voice-driven, many of which are performed on hand-held devices. This number should jump dramatically as consumers continue to bring devices into their homes. Not surprisingly, younger consumers are more at home with voice search, with 55% of teenagers using voice search daily.
5G technology is rolling out across the world. Many industries are poised to take advantage of the new technology, and virtual reality, self-driving cars and enhanced video conferencing will all have the opportunity to be delivered to the masses with 5G.
The Asia-Pacific region leads in rolling out the new technology, while the U.S. trails badly in the rollout of 5G. Less than 2% of all devices in the U.S. are actually ready for it, but phone companies are investing billions in new equipment. The first Apple 5G phone is scheduled to be introduced in 2021, and certainly others will follow.
3. Artificial Intelligence
Brands today are beginning to use commercially available artificial intelligence (AI) to intelligently identify and segment audiences, build and create test variations, improve performance, and optimize spend automatically — in real-time and at scale. The majority of companies say they want AI to enhance the features and function of their products, help optimize internal business functions, free up workers from routine tasks, and make better decisions. To do so, many companies are experimenting with AI in a variety of ways. Chatbots, purchase recommendations, dynamics pricing, ad targeting, speech and facial recognition, data analysis, and content creation are just a handful of the ways AI is finding real-world use today.
4. OTT Devices and Apps
The cable TV industry is quickly evaporating. Consumers have moved to over-the-top (OTT) providers like Netflix and Disney+ faster than most experts predicted. This is due primarily to the sheer quantity of available options for consumers, who want to be their own “programmers.” Let’s look at just some of the numbers:
- Over 44 million homes have cut the cord.
- The average American subscribes to 2.25 streaming services.
- Over $26 billion was spent in 2019 on media subscription services.
- Netflix has 60 million subscribers.
- Hulu has 27 million subscribers.
- Amazon Prime has 26 million subscribers.
And while the major players have continued adding to their numbers, newcomers are making a statement as they emerge on the scene. Disney+ has already reached over 40 million signups to date. Apple TV+ launched in 2019 to critical acclaim, and in 2020, NBC and HBO will be launching new OTT products.
Many Americans are frustrated by all the choices, which could lead to an eventual reaction in the market; however, in the meantime, consumer behavior is continuing to reward the increasing amounts of choice. Twenty-six percent of adults ages 18-29 binge-watch daily. This drops to only 7% of adults 65 and older.
5. Subscription Services
The subscription lifestyle doesn’t stop with media. In fact, almost 50% of Americans subscribe to some type of service. More and more, we don’t need to leave home; we can subscribe to almost anything these days — from gaming to music to wine. And this trend will continue to accelerate with consumer expectations for convenient, personalized online shopping experiences, which they could formerly only get in-store.
What It All Means for Marketing
Consumer expectations continue to be shaped and reshaped by emerging trends in a variety of industries. Even for those of us outside of markets for which voice search, streaming or subscription services seem to provide a clear application, our audiences in 2020 will increasingly live with and interact with them.
Industries like healthcare and B2B can respond with creative content, advertising and services that connect with people in familiar ways while delivering memorable experiences that make them want to interact, subscribe or “keep watching.”