Apr 18, 2017 - Economy

Growth in digital media consumption is slowing

Rates of increase in digital media consumption continue to slow, according to projections by eMarketer.

What it means: Because the number of hours in a day doesn't increase, media consumption becomes a zero-sum game. Per eMarketer, "increased time spent with one medium will tend to come at the expense of time spent with another." Slowing digital growth could mean users aren't ready to fully give up other mediums (radio, TV, print, etc.).

Data: eMarketer; Chart: Lazaro Gamio / Axios

While time spent is expected to plateau, so is user adoption of new mediums and sources of information.

  • Apps: As comScore identified last year, we are now at or nearing "peak app" usage, meaning that most smartphone users download zero or only one new app per month.
  • Social media users and penetration: eMarketer's projected growth for social media users and global penetration has been steadily declining and is only set to increase by 5% by 2020, compared to the 12% year over year increases in 2014 and 2015.

On the business side, scaled marketing is also showing signs of stagnation:

  • Facebook newsfeed: Facebook CFO David Wehner said in 2016, they expect their Newsfeed ad load to hit saturation by the middle of this year, (which is why we're seeing such an emphasis on video advertising).
  • Banner ads: An increase in ad blockers globally suggests that the digital display ecosystem has become too intrusive and crowded. The latest estimates show advertisers spending more money on native campaigns than standard display for the first time ever. Next year, native is set to make up over 67% of digital ad spend.
  • Brand emojis: "2015 potentially saw an overload of poor emoji integrations that didn't add much value," said John Ohara, SVP at Giant Spoon to Digiday. "A lot of brands moved into the space too quickly, and ended up neither being true to their core brand identity nor adding to it in a meaningful way."

Why it matters: Because our media diet is becoming more saturated, all of the players in the ecosystem will have to work harder to produce better content and experiences to maintain our attention, whether that be via digital ads, social personalization algorithms, videos or articles.

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