Acceleration Media managing director Diane Charton says that the online advertising market is enjoying growth and progress across South Africa and the rest of the world, in spite of deepening gloom about the state of the global economy. In this article she takes a look at some key trends in digital media.
ZenithOptimedia predicts lobal ad spend across all mediums will decline by %0.2 this year. Online, however, is expected to experience %18 growth, aided by growing spend in regions such as Latin America, Asia Pacific and Central & Eastern Europe.
The reason that online advertising is likely to continue to grow in a down market is simple; it’s a cost-effective and measurable channel that helps marketers to stretch their ad budgets.
That said, we can expert to see advertisers become more demanding and cautipus about how exactly they spend their online budgets, as well as begin to use the channel in increasingly sophisticated ways. Here are a few trends to look out for;
Bandwidth boom
The South Africa Internet service provider market has enjoyed its strongest year of growth since 2001. According to research from World Wide Worx, there are now 4.5 million Internet users in South Africa – a number that is projected to rise to 8.4 million in 2013.
There are developments afoot that should ensure strong growth during this year. Thanks to the planned introduction of new undersea cables such as Seacom, South African Internet users should benefit from cheaper and more abundant international bandwidth. New telecom regulations should also create more competition in the Internet service and telecom infrastructure markets.
Mobile marketing on the rise
After years of hype and promise, the mobile Internet advertising market is starting to take off. eMarketer estimates there were over 40 million mobile internet users in the UK, France, Germany, Italy and Spain in 2007, a number that is expected to climb to 100 million by 2011. Mobile search ad revenues are projected to grow to 500 $ million by this date.
Suddenly, a world of possibility opens up for advertisers, provided they take the time to understand how the mobile Internet differs from PC Web usage. As a personal device that users carry with them wherever they go, the smartphone offers a range of marketing applications to companies that are prepared to look beyond treating it merely as an extension of the PC.
Rich media and online video
South African companies have been reluctant to embrace rich media ads for fear of alienating dial-up users and because of the costs attached to producing and placing these ads. But we’re starting to see more interest from advertisers in rich media ads developed using multimedia technologies such as animation, audio, video and gaming.
Catching up with behavioural targeting
Another international trend in which South African marketers have lagged behind is the growing use of behavioural targeting which uses information collected on a user’s web-browsing behaviour (for example pages visited or searches conducted) to choose advertisements to display to that individual.
More careful market segmentation
A combination of cluttered media landscape and users who have become more resistant to online advertising mean that advertisers will need to think more carefully about where and how they advertise. What’s more, users, particularly those in social network environments, are looking for recognition as individuals by friends and vendors. Advertisers will place more focus on their segmentation strategies.
Social media
We can expect social media to be even more of a focus as organizations try to tap into the shared interest and mindsets of their target audiences, using tools such as social networking sites. Many South African companies are advertising on sites such as YouTube and leveraging tools like Facebook. Expect to see them do even more with social networks.
Increased measurability
Prices for online inventory are climbing as advertisers flock to the online world. However, a recessionary mindset means that companies need to count every penny they spend and make sure that they’re getting bang for their buck. That means companies will start measuring the results of every campaign more carefully and use more sophisticated tools to track return on investment (ROI).
Online vs non-online – how different are we?
Market research agency Kaufman Levin Associates (KLA) has conducted a survey of 962 demographically matched online vs non-online South Africans – with some fascinating results!
According to the survey it seems that even people from the same age, race and gender groups differ vastly in their beliefs, opinions, general knowledge and mindset based on whether they are online or non-online individuals.
These differences range from how they pay for goods and services to trying new foods (such as having ever eaten Mopani worms and Sushi), new experiences (such as visiting an acupuncturist or homeopath) to general knowledge about people, places, politics and brands – even to whether there is life on other planets.
“As well as discovering some very interesting facts about South Africans in general (like only %12 of those surveyed knew who Zakumi is), our research into online vs non-online South Africans has proved most fascinating,” says Matthew Glogauer of KLA (pictured).
“Online people are more engaged in their surroundings. They are more financially active, they use more information and media sources and tend to be more social, have had more and varied experiences, are involved in more activities and have more interests. The “onliners” appear to be more open minded, more aware of current events, people and personalities and be far more “aligned” with modern trends than those online,” he concludes.
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