February 11, 2017

FYI SEA Ad Spend Report: Opportunity, Implications And Realities
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The first FYI event of the year offered insights into the opportunities to be had for the digital industry – now armed with data from the first eMarketer and IAB Singapore SEA, Hong Kong and Taiwan Ad Spend Report. 

Kathryn Fries, Senior Director, Sales, eMarketer kicked things off with a methodology overview. The digital research firm drafted initial estimates based on analysis of macro-level economic conditions in the region, historical trends of the advertising market, estimates from other research firms, and consumer media usage data.

“Estimates were then updated after a series of reviews by member companies of IAB Singapore, with input from agency executives, publishers, and research companies in the region,” she said. “Going forward, we expect to review these forecasts every 6 months, as is our standard practice, and update them as needed.”

Fries also took attendees through the key highlights of the report.

  • SINGAPORE: Total media ad spending will slow during the forecast period but digital ad spending will continue to see double-digit growth through 2019.
  • INDONESIA: Total media ad spending is estimated to jump 8.4% in 2017, making it the fastest-growing market covered in this report.
  • MALAYSIA: Total media ad spending is projected to hit $1.30 billion in 2017, making it the second smallest ad market covered in the report.
  • THE PHILIPPINES: Digital ad spending and particularly mobile internet ad spending are rising quickly, but their shares of the country’s total ad investment remain modest.
  • THAILAND: A halt on advertising following the death of Thailand’s king led to reduced ad spending growth in 2016 to 1.5%. However, the country’s ad market will be helped along by the general election in 2017, with forecasts of 2.1% growth to reach $2.30 billion.
  • VIETNAM: Digital ad spending and particularly mobile internet ad spending are rising quickly in Vietnam, but their share of the country’s total ad investment is still quite small. 

[Download the report here]


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“What we can say for the region as a whole is growing rapidly, with double-digit gains in digital ad spending in 2017,” said Fries. “Increased demand for mobile, video and social media advertising will drive this growth.”

Opportunities and Implications

John Kerr, Chief Digital Officer of Zeno Group and project lead on the ad spend report, sought to bring context to the numbers with his presentation. 

One of the top takeaways is that if you look at it overall, media spend grows a little bigger but remains fairly static. Digital increases, mobile – no spoilers here – is the big growth engine and big winner here.

“But if you look at just the top line analysis you miss the churn, you miss the amount of transformation within the industry,” he said, adding that the industry has come a long way, going from 6% of total media spend to 20% in five and a half years.

“So it’s how do we go on and find the right balance between making sure that this moment and time is a truly transformational moment and time for us as an industry?” he added.

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Kerr outlined five areas or rather, food for thought, for the industry to focus on:

RELATIVITY 

As a marketer, I’m looking at these so called maturing markets as opposed to emerging markets. In many ways I’d say keep an eye on the transformation that is happening in India because in many ways it will be as, or more relevant to watch how India digitises itself moving to e-commerce, wallets and a high digital marketing context. It will get there.

MOBILE

Are we truly building the right capabilities, skills and capacity to understand what mobile really is and understand the psychological human differences, the format opportunities, and understand how to go to our clients and make them part with their money in this format – now this is a great opportunity

VIEWABILITY

We are in a region where there is still a huge mistrust about what goes on online so when P&G’s Marc Pritchard talks about adopting the MRC standards, the simple answer is that many of our Southeast Asian markets cannot adopt these same standards.

So, are we talking to our clients about what viewability is? Are we talking to them about the difference between viewability and ad fraud? Are we talking to them about the approaches that are being made globally and how they can be applied locally? This is the only way that we can overcome the psychology of mistrust.

CREATIVITY

With channels dispersing and breaking so quickly, the real creativity lies in iterative channel planning across programmatic and non-programmatic channels.  It lies in understanding formats and context. So again, if you are on a mobile device and you get served a banner ad and it takes your entire screen up as a consumer how does this feel vs. on a desktop? These are all the elements that we need to better understand.

CAPABILITY

If we do not help to build capacity, the reality of doubling digital investment and quadrupling mobile advertising investment will not happen.  And even with the exciting stage that our industry is at, there is a shortage of people, there is a shortage of good talent and there is a shortage of skills. And so I ask you, and I especially ask this in a mobile context – what have you personally done to improve your skills around digital marketing and mobile marketing?

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Mobile and metrics matters

During the panel discussion moderated by Joe Nguyen, Senior Vice President APAC of comScore, all panellists agreed that there is no doubt about spend shifting more and more towards digital and in particular, mobile.

Nanda Ivens, CEO of Mirum Asia Pacific pointed out that these days, most people would rather leave their wallet at home rather than their mobile phone.

“For the past few years, I’ve been hearing ‘this year is the year of mobile’ every year is the year of the mobile,” he added. “It’s already here!”  

However Tan Su-Lin, Head, Sales Strategy & Operations, Integrated Marketing, Singapore Press Holdings shared that despite many of the publisher’s online properties registering the majority of views via mobile, specific requests for mobile does not correlate.

“Are advertisers asking for mobile as a format that they’re actively seeking to buy?” she said. “More advertisers are certainly ‘buying digital’ a lot more, but asking about mobile as ‘moments of consumption’ and engaging consumers, is growing but not the norm yet.”

Sajith Sivanandan, MD of Malaysia, Vietnam, Philippines at Google noted the digital shift has already happened and is a secular trend, however advertiser demand may not be as uniform throughout the region yet.

“All mediums are important but that their relative importance has changed simply because audiences have shifted where they spend their time,” he added. “The data doesn’t lie, our lives do revolve around mobile now.”

 Asked about whether the focus on mobile skews too much toward activation campaigns as opposed to broader advertising executions, Richa Goswami, Asia Pacific Head of Digital, Johnson & Johnson noted how one buys media is merely a means to an end.

“If the creative is not compelling and it is not getting consumers to connect with it then it doesn’t matter how you bought it,” she said. “I don’t get as stressed about ad units as much as about how we can get consumers spend their valuable time connecting with what we have to offer them.”

Ivens pointed out that the competition for time and attention on mobile can result in a “graveyard of mobile apps”, where brands create apps that are not marketed and managed properly.

“It’s not just about activation or conversion, it’s about being a part of journey that the consumer is already on, with mobile at the centre of it,” he added.

Echoing Kerr’s earlier points, the panel agreed that key to ensuring digital advertising reaches its full potential, are talent and metrics. 

Tan noted that trying to either transition from traditional to digital or recruiting more digital talent remains a “difficult process.”

Sivanandan pointed out that if companies want to hire people with experience in the region, then the pool of candidates is going to be a small one – given the realities of digital as a still-nascent industry, and more focus should be put into educating young talent.

Ivens shared that individual companies do a “pretty good job” when it comes to training staff internally but as an industry, there isn’t much being done to support external talent sources such as universities. 

“There is no university in Indonesia that offers a course or subjects on digital marketing at the moment,” he said. “If this country of 280 million is going to have that double-digital growth in digital, and if this is going to grow, there needs to be outreach from all of us to create this base of education for the next generation of digital marketers.”

Goswami agreed, noting that traditional recruitment methods should also be retooled in order to ensure that wider pool of digital talent could be discovered.

The other hurdle to digital achieving it’s full potential is around what success looks like and the common metrics that define it. Ivens argued that for too long there’s been a “set of metrics brewing in the cauldron of KPI of death.”

“Change can be frightening and there are only too many marketers happy to keep on doing what they know and just as many agencies that are only too happy to comply,” he said. “We actually need to push each other, and if as an agency we don’t have the balls to push clients on adopting better metrics then nothing will change.”

But while the digital advertising industry continues on its path to maturity and consensus around metrics, for brands one thing is already clear.

“Ultimately we’re here as a business to make an impact,” said Goswami. “We need to be able to see the impact of digital on objectives as simple as ‘is it helping my product move off the shelves?’ and I think we’re getting better at understanding that.” 

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