The pandemic, supply chain issues, and economic volatility have affected many industries in the United States, not the least of which is the media and entertainment industry. Like many other businesses, media and entertainment companies have needed to pivot their internal and external business processes to adapt to the many changes in consumer demand and expectations.
During the height of the pandemic in 2020, consumer spending for theatrical and home entertainment dropped by nearly 20 percent, according to the Motion Picture Association. This marked a global shift in the way people consume entertainment, and while numbers are now rebounding to pre-pandemic levels, the abrupt setback was a wake up call to many media and entertainment companies.
It is difficult to predict a worldwide crisis such as a pandemic, however, by looking toward the future and getting ahead of consumer trends as much as possible, media and entertainment companies can experience stable, sustainable growth. Here are the five biggest media and entertainment industry trends to look out for in 2022:
- The rise of virtual reality. With the launch of the Metaverse and other virtual reality concepts and platforms, simulated digital entertainment experiences will continue to become more popular in 2022. The global virtual reality market grew by about 42 percent in 2020 and is expected to grow another 45 percent from 2021 to 2028, according to Fortune Business Insights.
- The continued growth of video streaming services. Subscription video streaming services, such as Netflix and Hulu, saw a boom during the pandemic and experts anticipate these services will continue to increase in popularity in the coming months and years. Subscriptions to online streaming services have reached 1.3 billion globally, which is a 14 percent increase from 2020.
- The monetization of NFTs. An NFT, or non-fungible token, is a type of data that is stored and traded on a blockchain and allows users to purchase and sell photos, videos, audio files and other digital assets that can accrue value. According to EY, NFTs could allow media and entertainment companies to give their consumers new and imaginative ways to engage with content and create cross-platform consumer interactivity.
- More pressure on in-person entertainment. Because of the rise of digital media and streaming services, live entertainment companies will face additional pressure and competition. Online services offer greater convenience, choice, and cost-efficiency, which means in-person venues will have to get creative if they hope to stay relevant.
- Expansion of the “creator economy.” Independent content creators and influencers will continue to rise in popularity in 2022. Platforms like YouTube and TikTok, as well as social media channels, give these creators access to an enormous audience base with a relatively small financial barrier to entry. Influencer Marketing Hub estimates that the creator economy is worth about $104.2 billion and rivals the growth trajectory of the gig economy. Many media companies are choosing to harness the power of these digital creators through paid sponsorships and partnerships instead of trying to compete with them.
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