The Electronic Retailing Association

Article: TV futures: what the changing TV market means for the home shopping business

Ampere Analysis is a London-based industry analyst firm

by Guy Bisson

Guy Bisson, Executive Director of London-based industry analyst firm Ampere Analysis, recently presented at the ERA Annual Conference in Venice on the changes taking place in the global TV industry. Here he takes a look at the future of the TV business and why the home shopping industry needs to pay attention.

TV is the engine of home shopping; and the TV business is changing. As a television-industry analyst it’s my job to make a call on the significance of changes that are taking place and predict where the industry will be in five years’ time. But just as important is context. By focusing on change, it’s all too easy to give the impression that things are moving faster than they really are.

For anyone with a business reliant on a linear TV shopping channel or an infomercial production business, you can safely ignore everything that is changing in the industry and still have a great business in five years’ time. But if you start positioning now, you’ll have a much stronger business. And ignore the changes for much beyond that, and you may find yourself in trouble.

So what is happening out there? One fundamental shift is the transition towards Over-the-Top (OTT) delivery of content, carrying with it a shift in non-linear viewing and viewing device usage. Growth in non-linear subscriptions to Subscription Video-on-Demand (SVoD) services like Netflix have been outstripping more traditional pay TV options globally since 2014, and will continue to do so.

At the same time, a small but significant number of homes are now using SVoD as the main way they watch TV. Yes, there is an age effect—and home shopping’s more middle-aged skewing demographic still watch a lot of linear TV—but newer platforms are extending viewing throughout a wider part of the day than the traditional linear primetime, and also creating device-specific primetimes for mobile phones and tablets. That’s a good thing for home shopping, not least because of the natural link between shopping and online retail with these particular devices.

But how important are these changes to today’s home shoppers and what about the next generation of home shoppers, yet to fully engage with the medium? Our research shows that home shopping’s core demographic engage well with relevant advertising, prefer watching on the main TV set in the home, like socialising and binge viewing and are heavy users of social media. When not using a traditional TV set, the tablet is the viewing device for which they skew most. So while they are not the most ‘next-generation’ of viewers, they can be already be reached on certain key devices and online platforms. And interestingly, early data suggests they are engaging with voice control artificial intelligence hardware like Amazon’s Echo (Alexa)…a key for the future of TV navigation as well as content and retail discovery.

Looking to the next generation, it’s clear that young women engaging with reality and lifestyle content show very strong skews to newer TV platforms and viewing behaviour. Fans of this content type are much more likely to be under 35, female, and living with a partner and young child than the average home. Arguably they are a key indicator of the next generation of home shopping viewer. What’s clear is that these women are watching far more online free content, catch-up and SVoD than average, and watching more TV overall.

That’s why finding a model for home shopping that works in a non-linear, device-focused environment, away from the known-safety of linear TV feeds is key. And with the rise of social media as both a platform for, and buyer of, TV content, as well as the increasing facilities for live broadcast on social platforms, social TV is a pretty good place to start.

Guy Bisson, Research Director, Ampere Analysis, London.
Guy Bisson, Research Director, Ampere Analysis

Guy Bisson has more than 20 years’ experience as a leading entertainment market analyst with a specialisation in the global television business. He is a regular speaker and moderator at many of the World’s leading entertainment business conferences, a frequent media commentator and author of numerous reports and research articles on the business and strategy of the television industry. In recent years, Guy has had a particular focus on quantifying and forecasting the impact of OTT television on the traditional media players and has written a series of ground-breaking reports on the topic. Guy previously led the television research practice at Screen Digest and IHS and is now Research Director of Ampere Analysis, a London-based research company with a global focus on television and new media that is combining, for the first time, big data analytics, consumer research and industry analysis.