Disruptive technologies are an innovation led change that impacts current and new product (content) development across the industry as a whole and requires that organizations must respond or be left behind.
The current animation industry is intrinsically tied to advances in digital visual technology and currently coming to terms with a number of disruptive technology issues in the market. Some examples of the disruptive technologies include;
- High powered animation production tools (hardware and software) are now available at the consumer level,
- New high level production technologies in the market can give competitors a significant technological advantage
- New and different distribution technologies such as Youtube compete with traditional distribution channels for audience and advertisers revenue which requires new revenue models.
- These new distribution channels are used to exhibit consumer generated content which and often comprises either cheap amateur or pirated content.
- Mobile devices can also be seen as a disruptive technology as new strategies need to be developed to create or transition content form traditional media to mobile devices
2. Piracy (Copying content – Appropriating characters)
Copying and Sharing of copyright, trademarked or other IP material is a serious marketing challenge across the entire digital entertainment industry as it results lost revenue to the organization and can be seen to dilute the premium value of the brand
Animation Companies face a marketing challenge to get people to participate in legitimate commercial interactions with animated properties and reject illegitimate interactions. The availability of pirated content can be seen as inadvertent yet significant competition for the market / audience. There is a Challenge to change peoples perceptions that everything on the internet is free
3. Fragmented & Diffused Market
The Animation entertainment market is very fragmented and diffused globally. Consumer tastes and styles vary dramatically and animation offerings are produced for a vast range of indicators
4. New Landscapes, Different Rules
Animation entertainment is increasingly considered a global commodity and animation companies strategically look to extend their geographical reach into a variety of existing and new international markets. This can be seen to be a competitive necessity to both reduce the risk and to maximise returns on investment
Although animation is considered more adaptable than other entertainment formats to transverse into new and culturally different markets there are significant marketing challenges. These are to ensure that commercial outcomes including developing brand equity are realized while navigating demographic, psychographic and behavioural differences such as religious and societal sensitivities to characterization.
All of these markets are regulated by national broadcasting frameworks that reflect and enforce the cultural standards of the country. An example of this is the ‘Commercial Television Industry Code of Practice’ which in conjunction with ‘The Australian Communications and Media Authority (ACMA)’ regulates the content classification system that all media in Australia must carry.
In mature markets the rules of the game can also change, currently there is a societal movement to stop the advertising of junk food during Children’s programming as a response to rising Obesity levels in children in the western world. Legislation to this 6effect would negatively impact the purchasing power of Channel distributors.
5. Complex Channel Relationships
How to get content to potential consumer; push-pull from animator/production houses/media channels
Animation production companies are in essence pitching a market segment to a buyer (distributor). The buyer is actually buying an entertainment property to fill a market segment. Effectively the animation company is selling the audience to the channel distributor who then in turn sells the time and space around the program to advertisers who want to access that particular market segment. There is a challenge to build equity in a company brand and or a portfolio of entertainment products/brands that can meet the needs of the buyer
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