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Home Asian e-Marketing July - August 2009 Online Marketing Growth in Asia: More than Meets the Eye

Online Marketing Growth in Asia: More than Meets the Eye

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Next-generation digital marketing strategies provide all the metrics necessary to evaluate advertisement reach and effectiveness, helping advertisers save costs and create highly targeted campaigns. Online advertising in the Asia Pacific is all set to grow due to a greater number of big brand advertisers that are adopting the online model, followed by the rapid growth of advertisement networks over the past two years. The paid search advertising market is also expected to get a leg up from the overall growth of search and innovative targeting options as well as proliferation of search engine marketing (SEM) agencies and advertisement networks.

Online classified advertising’s biggest driver has been the rapid audience shift, especially among the youth, from print to online. As people increasingly turn to the Internet for distributing and accessing ‘infotainment’ content, all segments of the online advertising market are expected to expand. Market participants will also gain from the adoption of new interactive products beyond the banner. Streaming video, branded content, mobile integration, and cross-media integration are all likely to offer successful campaigns.

However, market participants should not lose sight of their numerous security problems such as, click fraud, credit card fraud, advance fee fraud, employment scams, or phishing. It is therefore vital for the entire online industry to make a concerted effort to curb online frauds and create an ecosystem that increases advertiser confidence. Online advertising companies in the Asia Pacific are expecting to face further a significant challenge of inadequate digital media skills in the labour market, according to analysts. Low awareness among small and medium enterprises about the power of online promotions and lack of industry standards for advertisement formats, pricing, and reporting in line with the major international guidelines are also restraining the growth of the market.

Online advertising companies should also look out for poorly executed spend management tactics and keyword strategies, which can compromise search marketing’s main selling point of ROI effectiveness. With digital media currently being a key focus for advertising budgets, participants of the online advertising industry will not only have to restructure and improve their own strategic focus but also work hard to bring major agency partners to speed.

Online advertising is the future - at least in this point, all parties agree. However, there is disagreement regarding the statistics and predictions in the amount of advertising spending.
Many well-known institutions present at regular intervals, new market figures and forecasts on the future of the digital economy and cause unfortunately only unnecessary confusion in the advertising industry. Significantly responsible for the discrepancies of the various data acquisitions are the applied methodologies. It is worth to take here a closer look, though the basic message that the online advertising market is growing disproportionately, will remain unaffected. Forecasts are often too conservative, or discounts areas like search term marketing, or simply ignored affiliate marketing, so that ultimately only a snippet of the actual online advertising turnover in taken into account. It may also be that a crawler process is used for the evaluation of the data that captures the displayed ad on the selected sites. With this method, however, important areas of online marketing can’t or can only inadequately be captured, for example, so-called targeting campaigns, which roll out advertising material according to demographic, territorial, or even usage-behavioural aspects for a higher cost per thousand (CPM).  The same applies to the "frequency capping" (limitation of the advertising material contacts per user), rotations (inaccuracies in terms of completeness of the rotation campaigns), advertisement in password-protected areas (interesting especially for the premium content providers), sponsorships (for example, solid integration of logo in the background) and other integrations such as sub-channels. Even without data transfer, ascertained data causes imprecision. This includes, among other things, the increasingly occurring hybrid models of the major marketers, which means the mixture of CPM and CPC (cost per click) models or invoicing according to CPX (Cost per Action). Furthermore, this includes inaccuracies in the actual delivered ad impressions.

Researchers also counter-attack that a main reason for the discrepancy would be the difference between prices declared formally and the actually negotiated terms. However, this would mean that the online marketers would grant large discounts just in times of high demand, which would contradict any smart commercial behaviour. Here lies definitely the biggest challenge in the future, namely hedging the existing figures further and making at the same time reliable statements on net advertising revenues across the entire online advertising. At least the first moves are already done.

Despite all mentioned uncertainties there is nevertheless a common conclusion in sight: the online marketing sector continues to grow disproportionately and its importance is growing significantly from year to year in the total advertising market. As the published figures do not take into account any agency fees, which can’t be dismissed in this medium, this only features the importance of the digital economy as an economic sector.

By Daniela La Marca

 

 
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Contents (July - August 2009)