China, Brazil and Singapore Lead Consumption of Digital Media and the
Willingness to Pay for It
TORONTO, Jan. 21, 2013
Consumers still spending more money on traditional media with digital and
traditional media sharing a complementary co-existence
Both an opportunity and threat to advertisers is a new generation of 'digital
multi-taskers' accessing multiple media simultaneously
Tech and media providers should collaborate on breakthrough revenue models to
win over the information-hungry digital consumer
TORONTO, Jan. 21, 2013 /PRNewswire/ - Urban consumers in China, Brazil and
Singapore are proving to be the world's most voracious users of digital media,
powered by the rapid uptake of smartphones and tablets according to the KPMG
International 2013 Digital Debate.
All around the world, consumers are showing an insatiable hunger for media in
all its forms be it digital or offline, according to the survey which measures
the current impact of digital and traditional content on approximately 9,000
consumers in nine countries around the world.
"Consumers in China, Brazil and Singapore across all age groups are accessing
and using media at an astonishing pace," says Gary Matuszak, KPMG's Global
Chair, Technology, Media and Telecommunications. "They are quick to acquire
hand-held mobile devices, and are incredibly receptive to all forms of
information, news and entertainment from TV, internet, newspapers, magazines
Devices set ground rules for new revenue models
A new generation of mobile-centric consumers is getting its first media
experience via devices. This growing segment has a much greater preference for
digital media, and the coming of next-generation, high-speed mobile networks
will likely accelerate this trend.
Among urban Chinese consumers, 78 percent own or intend to own a smartphone,
slightly more than laptops (76 percent), and 51 percent say they have or plan
to have a tablet computer- a higher penetration than the US, UK, Germany or
Australia. Overall, 53 percent of total respondents own or intend to own a
smartphone and just over a quarter (26%), a tablet computer.
Moreover, consumers from China, Brazil and Singapore not only prefer to access
their content digitally, they are more willing to pay for it. Mobile-centric
consumers' propensity to pay for content may provide invaluable insights to
media and tech providers in mastering breakthrough revenue models.
"In emerging, high-growth markets such as China, people are not encumbered
with the legacy of PCs and have leap-frogged straight onto portable devices,"
observed David Elms, Head of Media for KPMG in the UK. "This creates amazing
opportunities for tech and media companies, many of which are struggling to
devise models that are profitable and which truly sate consumers' vast needs
for information. They need to delve into understanding content much more
intimately as it relates to their customers and then, marry the two."
Traditional media still popular
Interestingly, consumers across all markets spend a similar amount of time
accessing media online as they do using traditional media.
Visiting social networking sites, accessing maps and directions, and viewing
news online are the top three digital activities across all markets. Consumers
in China and Brazil lead all countries in accessing social networking, news
and downloading music.
In the traditional media space, TV is still the most popular traditional
medium across all markets followed by listening to the radio and thirdly,
print such as newspapers and magazines.
"The move to digital has had a dramatic impact on how we consume music,
publishing and newspapers. But we are still early in the process of a
transition to digital anytime-anywhere availability across all media sectors,"
said Paul Wissmann, Head of Media & Telecommunications, KPMG in the US. "Until
online services can provide content - especially film and video - on all
devices, including home televisions, and be as seamless and easy to use as
their offline counterparts, 'old' and digital media will continue to
Online, time spent does not necessarily mean money — yet
Most consumers are still spending more money offline in traditional activities
than online, although this varies considerably according to country and type
Overall, however, consumer spending for digital content is gradually rising,
with respondents reporting higher year-on-year spend for every form of digital
media. In North America and Europe, for example, 37 and 20 percent of
consumers, respectively, say they have increased their spend in accessing
magazine applications compared to last year.
While China, Brazil and Singapore lead in their willingness to pay for online
content, consumers in North America and Europe show a higher willingness to
only pay for access to certain content, such as dating sites and books and
less on news, music and games, for example.
"A number of content owners are trying to repeat the traditional revenue
models online, aiming to reverse the trend of getting information for free.
Consumers are only prepared to pay for content if it is perceived to have
value, at the right price, in the right format and accessible on the right
device," KPMG's Elms said.
Offline, consumers are cutting their expenditures on packaged media,
especially CDs, DVDs and console games, with the same proportion of all
respondents (23 percent) saying they have spent less on CDs and DVDs in the
last 12 months. The big offline winners are those tied to a venue: sporting
events, concerts and cinemas.
Rise of the 'digital multi-tasker' —opportunity and threat to advertisers
The 'second screen' experience lets consumers interact with multiple connected
devices simultaneously often while also watching TV. Nearly half (48 percent)
of all Chinese consumers say they use their smartphone while viewing the TV,
while 60 percent say they use their laptop while watching TV, around half (52
percent) read newspapers and around a third (36 percent) are accessing social
networks. Half of all North American respondents say they watch TV and access
the internet for reasons other than social networking using a laptop or a PC.
Forty-four percent of European respondents say they do the same.
Accessing these multiple devices concurrently appears to impact advertising
effectiveness — but not everywhere, according to the survey. Urban consumers
in Brazil, China and Singapore have the highest receptivity to advertising and
accept that it can underwrite the cost of the content they enjoy.
Seventy-seven percent of Chinese consumers and 62 percent of Brazilian
consumers are happy to receive online ads in return for lower-priced or free
The story is a little different in the more developed markets, where the
aversion to advertising is greater, with only 46 percent of North Americans
and 39 percent Europeans willing to accept such a deal.
"The opportunity exists for media companies to tap into 'second and third
screens' via social media channels such as Twitter and Facebook and create an
overall experience and effectiveness for advertising," Elms asserted. "At the
current time, however, the integration tends to be only partial."
Media and technology players cannot go it alone
To satisfy the intense information needs of tech-savvy consumers, content,
devices and distribution channels need to be integrated, the survey suggests.
It is unlikely that any single player can master all these components, making
cooperation and collaboration a necessary approach.
"The new class of digital consumers wants more and different 'information
experiences' and is prepared to pay for high-quality, video, music, books and
digital print material from recognized brands," said KPMG's Matuszak. "While
tech companies have powered the ecosystem for the new user experiences and
will continue to drive innovation in content creation and delivery models,
traditional media companies have the opportunity to evolve, as some have done,
to join tech companies as innovators in these areas, and open the door to new
About the survey
To understand how consumers are allocating their time and budgets to media in
all its forms, KPMG International commissioned YouGov to undertake an online
global survey of more than 9,000 consumers across North America (US, Canada),
Europe (Germany, Spain, United Kingdom), Asia Pacific (Australia, metropolitan
China and Singapore), and Latin America (metropolitan Brazil). Metropolitan
China has an estimated population of 426 million and metropolitan Brazil 50
million. In each market, around 1,000 adults (aged 16+) were interviewed, with
the exception of the US, where the interviewees were all 18+ and China and
Brazil, where the data was representative of the "urban populations". The data
was weighted across age, sex and region. All figures, unless otherwise stated,
are from YouGov Plc. Fieldwork was undertaken between 1 and 15 October 2012.
About KPMG International
KPMG is a global network of professional firms providing Audit, Tax and
Advisory services. We operate in 156 countries and have 152,000 people working
in member firms around the world. The independent member firms of the KPMG
network are affiliated with KPMG International Cooperative ("KPMG
International"), a Swiss entity. Each KPMG firm is a legally distinct and
separate entity and describes itself as such.
YouGov is an international, full-service market research agency offering added
value consultancy, qualitative research, field and tab services, syndicated
products such as the daily brand perception tracker BrandIndex and social
media analysis tool SoMA, fast turnaround omnibus and comprehensive SixthSense
market intelligence reports. YouGov's sector specialist teams serve financial,
media, technology and telecoms, FMCG and public sector markets. YouGov is
considered a pioneer of online market research and has a panel of 2.5 million
people worldwide, including over 350,000 people in the UK representing all
ages, socio-economic groups and other demographic types. As the most quoted
market research agency in the UK, YouGov has a well-documented and published
track record illustrating the accuracy of its survey methods.
For further information visit yougov.co.uk
SOURCE KPMG International
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