The Future of Free Time

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Today, we believe consumers spend roughly 39% of their free time online and that number is going to reach over 50% by 2030. We think as AI tools are rolled out in the workplace, working hours will be freed up. And so with that, I'll pass it off to Andrew Kim who will take you through Connect2TV, Social, Advertising and SportsBedding and get into some of the trends we think are going to really shape the next decade of the digital consumer.

Welcome to the Big Ideas Monday Miniseries, brought to you by the For Your Innovation Podcast.

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This week’s Big Ideas Monday Mini Episode focuses on Digital Consumers.

In 2022, digital leisure spending* totaled $6.6 trillion and, during the next eight years, should grow 17% at a compound annual rate to $22.5 trillion adjusted for inflation. Four trends should contribute to its growth:

Connected TV (CTV): Roughly 85% of US households have access to at least one CTV, but the CTV ad market is only 23% the size of total US TV ad budgets. In our view, CTV is at an inflection point and will take share from both linear TV and other digital ad budgets.

New Social Platforms: Nearly 40% of Gen Z consumers prefer to search on TikTok and Instagram over Google Search and Maps. Social platforms with the best recommendation engines should command the majority of ad budgets, with content-based social media likely outperforming follow-and-feed social media.

Sports Betting: Despite macro headwinds, consumer demand for sports betting remains strong. Legalization of online/mobile sports betting should continue to catalyze growth.

Gaming: The convergence of video games and social media should sustain gaming revenue growth. Video games should provide end-to-end virtual entertainment that rivals physical experiences.

Watch the video version here.

*We define digital leisure spending as the sum of consumer expenditures on leisure-related goods and services purchased online, NFTs, online sports betting, video game software and services, streamed video, and streamed audio. We only estimate online sports betting volume generated in Canada and the US. Sources: ARK Investment Management LLC, 2023. Altruda, C. 2022; Roblox, data as of 12/30/22; S&P Global Market Intelligence, data as of 01/25/23. The World Bank, data as of 12/30/22; Insider Intelligence, data as of 01/02/23; S&P Global Market Intelligence, data as of 01/25/23; Perez, S. 2022; Statista, data as of 01/25/23. Forecasts are inherently limited and cannot be relied upon. For informational purposes only and should not be considered investment advice or a recommendation to buy, sell, or hold any particular security. Past performance is not indicative of future results.