Digital Australia: State of the Nation 2017 - Review and Insights

  • Device Usage Amongst Australians Today
  • Digital Entertainment - Netflix and Chill, Anyone?
  • Digital Device And Service Expenditure

It is absolutely crazy how quickly we have travelled into the second half of 2017, and this year has thus far been bursting with all things digital. In today’s article, we will be reviewing Digital Australia’s State of the Nation report, and bringing you some insight into some of the key pointers that we believe you should pay attention to in this year’s insightful report. Well, let’s not waste any more time and get stuck right into it, shall we? 

Australia’s Global Positioning  

First and foremost, let us have a look at where Australians digitally rank on a global scale. Unfortunately, we now rank 18th in a list of 139 countries, two places lower than we were last year on the World Economic Forum’s Networked Readiness Index. For those who aren’t familiar, this index is a measure of the necessary drivers for digital technologies to meet their potential. This year, some of the factors that have driven our national ranking down include the cost of fixed broadband as well as a not too impressive score when it comes to business adoption of ICT. Although this year’s score is on par with 2014’s rankings, our digital position has unfortunately deteriorated whilst other countries see themselves soaring in advancements.  Australia is now outstripped by nations such as Denmark, Hong Kong, Korea, Canada, Germany, Iceland and New Zealand with regards to digital readiness. The cost of fixed broadband is also a factor that has pushed our ranking down, with affordability being Australia’s lowest performing digital readiness aspect, currently ranked at fifty-seventh in the world. It’s not all frowns though, as we managed to score well in the individual usage of ICT, with the world’s tenth highest penetration of mobile broadband. 

As the globe’s thirteenth largest mixed-market economy, boasting an AAA rating from all three global rating agencies, it is not a secret that we truly should be further up the global digital rankings. We have a myriad of elements set in place for our nation to succeed as a digital economy, inclusive of absolutely outstanding talent, strong entrepreneurial spirit, national innovation and science agenda, a thriving start-up ecosystem and investment in fixed and mobile networks. However, Australia still remains quite far behind in the pack when compared to other advanced nations. Hopefully, in the coming years, Australia finds it way towards climbing up the digital ranking ladder, making full use of all the resources and potential that the nation has to offer. 

 

Digital Infrastructure 

Let’s now have a look at our digital infrastructure, comprising of mainly the NBN in this year’s report. Almost 70% of Australians like you and I, and 76% of digital opinion leaders have shown their support for the NBN. This support shows us the underlying level of recognition shared by all our people that Australia does indeed need major digital infrastructure programs in place. 

The support shown by Australians towards the NBN is one that is shared amongst our neighbouring countries, with regards to their broadband networks. When asked if the NBN would help ensure their nation has a top class digital economy, the level of support is as follows: Australians (40%), Singaporeans (47%), Malaysians (42%) and New Zealanders (25%). 

It is no secret that one of the most critical aspects of a developing economy is progressive thinking and the courage to make bold decisions – one of these bold decisions would include taking the steps towards building some major infrastructure for a nation. The NBN is indeed a fantastic representation of such a bold decision and commitment, one that is a foundational piece of digital infrastructure for all Australians. Regardless of the continued discussion about the investment and efficacy of the NBN in regards to what might emerge in the future, it is here, it is now, and the NBN’s aim to have 8 million households connected to it by the year 2020.

 

Device Usage Amongst Australians Today

Wherever you go these days, you’ll see someone using a device. Whether that be a tablet, a smartphone, or even a smartwatch, we can’t escape the age of digital devices. I mean, even children use iPads these days, something that none of us would have imagined 10 years ago. Across the fifteen different types of devices that have been explored this year, it has been found that Australians use 4 devices on average. How crazy is that! We also seem to have a high inclination to trade our devices up, as data has shown that we have one of the highest propensities to upgrade our smartphones per capita. 

While smartphones obviously are ubiquitous in today’s world and dominate with an 88% usage, it has been found that use of other devices is slightly more fragmented. There has been a decline in the usage of laptops/notebooks/desktops as mobile devices take more share. One of the largest shifts this year is in the extent to which people are connected to one another and the degree to which they have devices that are connected to the internet. Australians are now more connected to the Internet than we ever have been before. This includes smart TVs, gaming consoles such as the Xbox and Playstation and set-top boxes. In fact, it is safe to say that we are now a nation of tech-obsessed individuals. 

 

Digital Entertainment - Netflix and Chill, Anyone? 

This year, it’s been all about the streaming.  Once a completely niche sector, it seems like now, everyone is streaming movies and music online. In the last year, Netflix has jumped from being accessed by 60% to a whopping 76% of Australians who stream. In fact, the proportion of Netflix subscribers is now on par with Foxtel users (24% vs. 23% of Australians respectively). Why is this so? Well, according to digital opinion leaders, the ease of use, flexibility and personalisation offered by Netflix has now set the benchmark for what a positive and ideal streaming experience should be. People will no longer settle for anything less. And how about the future of streaming? Well, we expect to see streaming services from all providers to continue to propel themselves into the next year, something that is so obviously reflected by Foxtel’s current focus on streaming, with their launch of the revitalised streaming service, Foxtel Now.

When it comes to music, you’d be surprised to know that the radio plays a predominant role in the delivery of music to Australians today. Who would have thought? In fact, it is still the top source for listening to music, although it has indeed dropped slightly this year. This is probably because music streaming services are growing in popularity, with ‘watching music on YouTube’ contributing as a major source and the top medium for those aged 18-34. Music subscription service such as Spotify and Apple Music usage also ranks high amongst this age band. In fact, you who are reading this probably subscribes to one of these music services. One of the plus sides of the music streaming era? With improved accessibility in recent years, we have seen a decline in consumer propensity to access unauthorised or pirated content in recent years, which is definitely a win for all. 

 

Digital Device And Service Expenditure

The average household is now spending more than we ever have on digital products. In fact,  the total amount spent by Australians on digital products is $3,426 per year on average. This can be broken down into $978 in upfront costs on digital devices and $204 monthly on digital expenses. Compared to last year’s findings, Australians are now spending $200 more upfront and $20 more per month on digital-related costs. 

Driving this amazing boost in digital spend is increased amounts spent across all various devices, with laptops and computers continuing to be the highest cost, followed by smartphones. Of the ongoing costs, home phone, internet plans and smartphone bills make up the largest portion. With this increase in spend, you might think that Australians may start to worry about spending too much of their hard-earned coin on digital expenses. Well, surprisingly, 69% of Australians are happy with their digital spend, a 6 percent increase from last year’s 63%! What we realise is that people are now starting to see the value of spending a little more and getting the full benefits out of their digital devices. Only 22% of us feel like we spend too much. Among the Australians who feel like they are spending the right amount on their digital expenses, the average monthly digital spend is around $188 per month.

 

E-Commerce

Who doesn’t love a little online shopping? From books, clothes and electronics all the way to groceries, all of us have spoiled ourselves once in awhile with a cheeky online shop. In fact, 96% of Australians have made a purchase online over the past twelve months. That’s a whopping 24 million people or so who have purchased something online in the past year. The largest areas that people are spoiling themselves online on are homewares, groceries, media and fashion. 

You’d be surprised to know that this year’s biggest growth is in food. In fact, it seems to be our biggest grower year after year after year. After all, why walk around the grocery store for hours when you can have someone else do it for you? Even when in a physical store, over a third of Australians have conducted research on our tablets or smartphones. This underlines the absolute importance of search optimisation in a bid to get consumers to the information that they need as quickly as possible. There also seems to be a great appeal in the digitalisation of the physical shopping experience, with over a quarter of Australians being huge fans of online shopping. This was particularly driven by younger Australians this year. 

 

When It Comes To Products & Services, Context Is Key

It is no surprise that organisations need to, now more than ever, adapt their products and services to complement consumers’ digital lifestyle. It is absolutely crucial to fully comprehend what consumers are doing with their devices and figure out the best ways to connect with them in their different environments. 

The context – entertainment, social, financial – in which people use their devices is highly important. Why? Well, different contexts change customer expectations. Across the board, customer experience has evolved from omniplatform to omni-channel, with implications for IT as well as marketing, product development, distribution, packaging, and finance/payment. In any context, it is key that the consumer experiences a seamless and pleasant experience online. This means that fully optimised websites are necessary, ensuring that experiences are kept as best as possible regardless of what device your website or product is being viewed on. If not for a great experience, you will want to do this for better search rankings anyway, so the time for adaptation is now. 

 

Applications

Research has also found that Australians are now suffering from ‘app fatigue’. On average, consumers have around 24 apps on their smartphones but have pointed out that they only actually use about a quarter of these apps on a daily basis. This shows a  real issue with app overload – two-thirds of Australians surveyed agreeing that they have a significant number of ‘dormant’ apps that just sit around, doing nothing. In fact, take a look at your phone right now. Do you find that it is full of applications that you haven’t touched in months? Chances are this is the case. 

This app fatigue presents a huge conundrum for organisations who are seeking to improve their customer’s digital experience. These days, consumers are only interested in highly functional apps such as Uber, where the app is the actual service. In any other case, Australians are comfortable accessing content from modern and optimised websites instead. Given that only 18% of consumers find it a disappointment if a company doesn’t have an app, businesses really need to start rethinking their app strategy. It’s not all doom and gloom though, as those who are currently developing apps can take comfort from the fact that Australians are willing to enable ‘location services’ and are open to using ‘push notifications’ for specific apps.

 

Social Media

Social media is an integral part of all our lives these days. This year’s research has found that Facebook continues to dominate, with the highest total usage across all age groups and the highest daily usage. Afterall, it seems that even Granny and Grandpa have Facebook profiles these days, right? Given that Facebook, at 80%, has a similar penetration as smartphone usage, optimising an organisation for social media, Facebook in particular, is now just as important as optimising a business for mobility.

Social Media works on a time frame – it is a 360 degree dynamic platform that never sleeps and is pumping, 24/7. With this timelessness, consumers are now expecting responses almost immediately and crises can escalate within minutes. Organisations and businesses now need the right technology, process and resources to support this need. Organisations need to be proactive, reactive and analytic in order to meet customer demands on social media platforms. Companies also need to think about how their brand, products and services are presented and resonate across all social media networks. 15 years ago, the job title of Social Media Marketer was unheard of. In today’s world, Social Media is everything, so it’s time to get on it if you haven’t already. 

 

Cyber Security And Privacy

Last but not least, let us have a look into consumer security and privacy concerns. The rise of the age of technology also comes to a few negative aspects. We continue to be concerned about what personal information of ours organisations can access, and what they might do with this precious data. For those who fall into this spectrum of worry, fret not. Thankfully, new privacy regulations that will be introduced very soon will increase the imperative for organisations to give customers transparency, choice and control. 

80% of the consumers who actively believe that organisations should be more transparent about how they use the customer information will soon get their wish. From 22 February 2018, the Notifiable Data Breaches amendment to the Privacy Act will dramatically increase the visibility of inadequate security around personal information. Companies will be required to notify the Privacy Commissioner and members of the public if their data has either been compromised or even worse, shared inappropriately with third parties.

On top of that, over the next few years, organisations can expect additional privacy compliance challenges requiring better management and control of their consumer data. As media coverage of notifiable data breaches continues to plays on consumers fears, politicians will come under pressure to do more to protect privacy. Eventually, Australia is expected to move closer to the global ‘gold standard’: the EU’s General Data Protection Regulation (GDPR).

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For further detail please visit the original report provided by Digital Australia: REPORT