Contrary to popular opinion, young people continue to read books. The findings of a recently released TeenReads.com study indicate that about 1 in 3 teens purchased between 3 and 5 new books in the past 6 months. Another 20% of these young readers bought only 1 or 2 books in the same time period while 20% buys at a much higher rate – 6-10 books. How can book publishers reach this market and establish loyalty and buying patterns to create lifelong customers? The TeenReads survey sheds some light on that topic as well.

Here’s what prompts an under-age-18 consumer to purchase a book:

• Descriptive copy on dust jacket 86%
• Cover 76%
• Familiar with the author’s previous work 89%
• Looking for a book in a series 78%

But other influencers are also at work in the teen market and these include:

• Friends’ book recommendations 83%
• Browsing in bookstores 83%
• Web sites 78%
• Reading reviews in magazines/newspapers 64%
• Family members 52%
• Teachers 47%

Like older consumers, teen purchase their reading material through a variety of channels. Here’s where teens prefer to purchase books:

• Chain bookstores 78%
• Local bookstores 45%
• Online retailers 44%
• Library book sales 36%
• Big box stores 33%

These young readers have definite opinions about what would prompt them to make more visits to a bookstore. Factors include better selection of books (63%), more book reviews (48%), hosted author events (45%), and comfortable sitting places (40%).

More bookstores may increase their marketing efforts to lure young readers at a time when so many other forms of entertainment compete for their attention.

[Source: A Closer Look at Teen Reading Preferences and Habits, Teen Reads.com, Fall 2009, printed in Youth Market Alerts, EPM Communications]

Amazon might have been the first to launch an e-reader device that captured the attention of a significant number of consumers but its dominant position faces some serious threats. The 2007 introduction of its Kindle generated plenty of buzz and competitors. The book industry in general has suffered declines in recent years but Forrester Research sees the e-book and e-reader device market as a bright sector and expects it to grow. The research concern predicts about 1 million devices will be sold during the current holiday season and perhaps another 6 million units will sell  in 2010.

All of these sales won’t go to Amazon however. Several other companies have introduced devices including Nook from Barnes & Nobles, Reader from Sony and Digital Reader from Irex. These marketers also have to keep Apple on their digital screens. According to Flurry analytics,  the nature of applications released to the App store has shifted dramatically from July to October of this year.  Books now represent 20% of the released apps while games have dropped from 17% down to 12%.  This shift underscores a point made by  Rotman Epps of Forrest Research: “[e]-readers are a transitional technology.” The long-term future of e-reading may well be linked to the ever-evolving smart phone.

It’s too soon to predict the lifespan of e-readers but as Rotman Epps also notes, “2009 is a breakout year” for these devices. Manufacturers and retailers will be increasing ad budgets as they battle for market share.

[Sources: Rose, Adam. Kindle Killers? The Boom in New E-Readers, Time, 10.11.09; iPhone Gets Serious about Books, Flurry, 11.01.09]

The recession has not been kind to the video game industry.  Consumers have been cutting spending on nonessentials this year and video games have fallen into that category. The video game industry is valued at $11 billion at the retail level but sales drops through the end of October have come in at 19%.

Not everyone is convinced that the industry’s problems are related solely to the economy. NPD analyst Anita Frazier says “what’s having an even greater impact is the availability of so many free games” on the iPhone and ad-supported Web sites. These free games compete with those available for the Wii, PS3 and Xbox 360 – all popular game consoles. Consumers who personally play video games on these consoles have the following demographic profile:

• Male: 56%
• Female: 44%
• Ages 2-12: 24%
• Ages 25-34: 20%
• Ages 35-44: 17%

These statistics points to a broad demographic audience which means that video game producers need to consider their marketing strategies carefully. The availability of multiple gaming platforms and steep competition from free offerings also complicates matters. Frazier points out “[w]hen it comes to developing successful games and targeting marketing and promotions, each gaming platform has its own unique challenges and opportunities to consider.”  For example, when Activision recently released Call of Duty, its newest game with a $40 million development price tag, it was expected to spend $25 million on an accompanying ad campaign that included broadcast TV spots. This kind of spending certainly gave the game great exposure but video game marketers should keep in mind that consumers learn about these products from the following sources:

• Word of mouth 41%
• Hands-on play at friends’ houses  31%

Analysts expect that Activision will make a decent profit on Call of Duty but a Businessweek column by Ronald Grover notes that caution is creeping into the industry. More companies are holding back releases, fine tuning the products and making sure they’re releasing games that deliver quality entertainment. That strategy along with careful marketing decisions will determine who survives in the long run.

[Source: Grover, Ronald. Dangerous Days for Video Games, Businessweek, 11.13.09; NPD release, 9.14.09]

Consumers have no shortage of options when it comes to entertainment. But will the popularity of newer forms of communication such as social networking reduce the amount of time consumers have for traditional entertainment? This is a valid concern according to NPD group which just released a report on this topic.

Echoing the findings of  other studies on new media, NPD confirms that more consumers are spending time online. Here are the percentages of people who say they have used these new forms of communication in the past 6 months:

• Visiting social networking sites: 37%
• Sending/receiving text messages: 63%
• Using Twitter: 9%

NPD also indicates that consumers are not cutting back on all paid entertainment options. Spending in the following categories is expected to rise:

• Digital music
• Movies in theaters

Study results also show that while consumers might not be as likely to spend on CDs and DVDs, they will do so when they can get “good value”.  In the meantime, NPD analysts also note that pay TV options such as cable and Netflix should experience a steady market. In addition, the study revealed that only 37% of women will spend more on entertainment this year versus 63% of men.

The bottom line from this study seems to be that social networking, which requires consumer participation but not money, may be taking up more time but consumers still want to preserve screen time which allows them to be entertained without participating. As long as consumers maintain this attitude, marketers of movies, music and TV shows will find a ready audience for their content.

[Source: Entertainment trends in America, NPD release, 11.4.09]