TV CONTENT STILL TAKES BIGGEST SHARE
Millennials have been stereotyped as the generation that doesn’t want to pay for anything. But new research from Deloitte says the “generation that won’t spend” is spending a lot on media content. Deloitte predicts that U.S. and Canadian millennials will spend over $62 billion on media content this year.
Despite the perception that millennials are only interested in free video, the biggest media expenditure for millennials who have their own households, just as it is for other households. Millennials who don’t live with their parents (about 70% of 18-34 year-olds) are expected to spend an average of $316 on traditional pay-TV this year. That’s almost half of their total media spending estimated at $750.
After TV, music is big with millennials. Deloitte estimates average spending this year at $125. About 80% are expected to attend a live event this year—and most say they would like to spend more on live music than in past years. So, about $100 of that $125 is expected to be spent on live music—more than double the $48 average for all Americans. As you would expect, millennials are the chief target audience for subscription music services. An estimated 40% of Spotify’s 50 million monthly active users and 12.5 million premium users are age 18-24.
Deloitte also estimates that millennials will spend an average of about $100 on video games this year—about $8 billion in all. That means that millennials account for about a third of the $22 billion to be spent on video games in the U.S. this year.
Millennials over-index on going to the movies as well. Despite their inclination to watch movies on various screen sizes, they still like the big screen and are willing to pay an average $12 per ticket because they go to see the latest hot flicks on busy Friday and Saturday nights at a first-run theater—and don’t qualify for a senior citizen or child discount. The youngest millennials, age 18-24, account for about 10% of the population but purchase a fifth of all movie tickets.
Believe it or not, millennials still buy books—spending an estimated $60 on average this year. That includes both hardcopy and digital books—and, importantly, textbooks.
Streaming video has just added to what 18-34 year-olds are willing to pay for television, movie and other video content that they can view when they want to on whichever device they want to use. Deloitte estimates that subscription video on demand (SVOD) now accounts for about $40 of annual media spending by millennials. In the U.S. 43% of 18-34 year-olds use Netflix.
In addition to live music, millennials attend live sports, they’re expected to spend an average $25 on live sports gate admissions this year. That’s less, though, than the $50 per capita spent by all Americans in 2014. Still, 86% of millennials watch TV sports, down only slightly from 93% of all Americans.
Most millennials don’t subscribe to a newspaper, but a sixth still do—paying about $120 per year. That puts the average for all 18-34 year-olds at $20, but Deloitte notes that annual spending is declining.
In addition to spending on media content, millennials are big spenders when it comes to technology to access that content. The typical millennial owns one or more new smartphones and has a big monthly data plan. And they need a high-speed broadband service to stream video. If they also replace their PC or tablet every four years and their games consoles every five, Deloitte estimates that annual spending by millennials on hardware and connectivity is around $3,000.