2020 in review Lockdown legacy impacts on entertainment

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The 20,000 Foot View:  Digital connections have filled the void left by real-world activities, globalising culture and experience. Yet this comes at the cost of deepening divides in trust and perspective. Changing economic circumstances have brought about a demographic dichotomy of age and income. Cohorts of higher security and spending power have become of more financial importance to commercial and entertainment propositions, while younger consumers of less financial security and power still hold the most cultural value in the attention economy. 

The early signs of recession have already begun to harshen these trends. However, adversity begets innovation. Just as in 2008, following global financial recession (WhatsApp, Spotify), new commercial and consumer innovations look like they will emerge from the pandemic year (live music streaming, UGC, streaming-first films). Much change was already incubating but has now been given the chance to break out. From monetising fandom to generating new creator income streams, new solutions are emerging as old habits evolve to fit the new normal, making a return to the old normal impossible. The pandemic has already had lasting impacts on society and culture. 

Key insights

• Due to lockdowns, time at home saw a shift of priorities and attention with entertainment time in particular seeing a        uplift 
• Despite resulting dependence on digital connectivity, trust in the news and social media diminished, increasing the importance of ‘in real life’ (IRL) 
• Digital fatigue combined with polarising global events to create a climate of tension, culturally and economically, which has yet to be resolved
• The effects of both the pandemic and potential recession have impacted younger        consumers the hardest financially and socially. This has accelerated a priority shift in entertainment to older, better-off consumers 
• Monetising fandom is enabled by both broad cultural relevance and focus on niche audiences, with games companies in particular seeing early success, and new cross-entertainment collaborations creating new possibilities for creators – from beginners, to veterans and current superstars
• Content monetisation strategies built on legacy formats – such as films relied on the cinema experience or pay-TV relied on sports for big game day viewing, are now being forced to recalibrate as streaming-first consumption decimates profit margins
• Live-streamed virtual concerts have been to the live venue as iTunes was to album sales, bringing convenience and lower price points (and ‘unbundling’ location) which may permanently affect the genre 

Companies and brands mentioned in this report: Amazon Prime, Amazon Prime Video, AppleTV+, Disney+, Donald Trump, Dune, Fox News, Game of Thrones, HBO Max, Home Depot, Houseparty, James Bond, Lord of the Rings, Netflix, Resolution Foundation, Star Wars, The Economist, TikTok, Twitter, Unilever, Warner Bros., Zoom