Generations Matter

Nielsen recently published their first quarter Total Audience Report for Q1 2017. It’s the best evidence that I’ve seen yet that there is a huge difference between generations when it comes to video viewing habits. Compared to most surveys that look at a few thousand people, these statistics are based on almost 300,000 households.

The report examined in detail the viewing habits of the different US generations – Generation Z (ages 2 – 20), Millennials (ages 21 – 37), Generation X (ages 38 – 52), Baby Boomers (ages 53 – 70) and the Greatest Generation (ages 71+). What might surprise a lot of people is that Generation Z and the Millennials together now make up 48% of the US population – and that means their viewing habits are rapidly growing in importance to the cable TV industry.

The report outlines how the various generations own or use various devices or services. But note that these responses represent the entire household. So, for example, when Nielsen sought answers from somebody in generation Z it’s likely that the answers represent what is owned by their parents who are likely a millennial or in generation X. Here are a few interesting statistics:

  • The broadband penetration rate between generations is about the same, ranging from 82% to 85% of households. It wasn’t too many years ago when the baby boomer households lagged in broadband adoption.
  • There is a significant difference in the use of OTT services like Netflix. 73% of homes representing generation Z subscribe to an OTT service, but only 51% of baby boomer only households.
  • Baby boomers also lag in smartphone adoption at 86% with the younger generations all between 95% and 97% adoption.
  • Baby boomers also lag in the adoption of an enabled smart TV (meaning it’s connected to the web). 28% of baby boomers have an enabled smart TV while younger households are at about 39%.

The biggest difference highlighted in the report is the daily time spent using various entertainment media that includes such things as TV, radio, game consoles, and surfing the Internet.

The big concern to the cable industry is the time spent watching cable content. For example, the average monthly TV viewing for those over 65 is 231 hours of live TV and 34 hours of time-sifted TV. But for people aged 12-17 that is only 60 hours live and 10 hours time-shifted. For ages 18-24 it’s 72 hours live and 12 hours time-shifted. For ages 25-34 it’s 101 hours live and 19 hours time-shifted. This is probably the best proof I’ve seen of how much less younger generations are invested in traditional TV.

This drastic difference for TV stands out because for other kinds of media there is not such a stark difference. For example, those over 65 spend about 67 hours per month using apps on smartphones while those 18-24 use 77 hours and those 25-34 use 76 hours.

There even wasn’t a drastic difference in the number of hours spent monthly watching video on a smartphone with those over 65 watching 2 hours per month compared to 7 hours for those 18-24 and 6 hours for those 25-34.

The only other media with a stark difference is video game consoles with those over 65 using 13 hours per month while those 18-24 use 49 hours per month. Other things like listening to the radio or using a multimedia device (like Roku or Apple TV) are similar across generations.

The drastic difference in TV viewing has serious repercussions for the industry. For example, TV is no longer a medium to be used to reach those aged 18-24 since they watch TV over 180 hours less per month than those over 65. We’re seeing a big shift in advertising dollars and during the last year the amount spent on web advertising surpassed TV advertising for the first time. When you trend this forward a decade it spells bad news for the broadcasting and cable industries. For many years there was a big hope that as people get older that they would revert to the usage patterns of their parents. But the evidence shows that the opposite seems to be true – that kids keep their viewing habits as they grow older.

When you compare this report to earlier ones it’s obvious that the difference between generations is widening. Just comparing to 2016 those over 65 are watching more TV each month while the youngest generations are cutting back on TV over time – Generation Z watched 15 minutes less TV per day just since 2016.

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