The Interactive Advertising Bureau Southeast Asia has released the Singapore Online Advertising Revenue Report, reflecting Digital Ad Spend at S$60.31m for the period January to June 2011, which is8% of the total advertising expenditure in Singapore.
Jointly commissioned by the Media Development Authority (MDA) and the IAB SE Asia (Singapore Chapter), the report was compiled by PricewaterhouseCoopers LLP to provide an analysis of the online and interactive advertising market growth and trends.
"This strong, stable growth is testament to the efforts of the entire industry," says Ken Mandel, Chairman, IAB SEA, Singapore Chapter. “Digital advertising continues to have a bigger share of an increasing pie, and we are moving closer to our ultimate vision where Online Advertising constitutes 20% of total advertising spend. Singapore is definitely one of the best places in the region for businesses to get into the digital space.”
Commenting on the announcement, Loren Shuster, Country Director-Singapore and Emerging Markets, Google says: "This positive momentum demonstrates the significant potential within the Singapore market as companies of all sizes discover the reach, impact and measurability of digital with headroom for more continued growth. Google looks forward to working with the IAB to continue to educate and partner with key industry stakeholders to ensure that Singapore reaches its potential as a leading digital marketing hub in Asia Pacific.”
Singapore has registered a Compound Annual Growth Rate (CAGR) of 19% for the 24-month period ending 30 June 2011, reflecting a confidence in online channels, encouraged by more stable economic conditions following unsettled markets in 2009 and 2010.
IAB Executive Director Ranji David explains that while the figures appear to have declined from the impressive CAGR of 36.5%, recorded in the 2010 year-end report, those numbers were buoyed by the inclusion of Google’s revenues from the network’s websites (“AdNetwork revenues”) into the report for the first time.
Display Advertising recorded a CAGR of 15% over the 24 months period, while Search Advertising expenditure logged in a CAGR of 27%, and therefore remains lower compared to other more mature digital advertising markets with continued potential for growth. Meanwhile, CPM (cost per thousand impressions) and performance-based pricing persist to dominate at the expense of tenancy-based pricing. Further, technology and telecommunications, travel and leisure, financial and business services, as well as property have been identified as the key sectors that spend online advertising budgets.
“Industries have crossed both a psychological and behavioural tipping point where digital technologies are the drivers of operating models and revenue growth. Monetization is still the key challenge for the industry and digital advertising will play a key role in sustaining the growth. The growth in digital advertising in Singapore underscores this trend. Going forward, we expect to see more creative ways to engage with customers online leading to improved monetisation of digital content,” said Greg Unsworth, Singapore Technology, InfoComm and Entertainment & Media Industry Leader, PwC LLP Singapore.
Singapore remains the top choice for online businesses that try to establish a foothold in the region.Therefore it is not surprising to see exciting new players in the area of platforms, technology and services, as well as across newer areas of digital such as social, mobile and video advertising in town. With the development of a more mature, complex and increasingly diverse digital advertising ecosystem, the IAB is well positioned as a platform for members to connect, communicate, and collaborate. IAB Singapore Chapters Executive Director enthusiastically announced: “We will be rolling out several new programs and initiatives over the next two quarters that we believe will allow the IAB to galvanize the industry and come together in a cohesive effort to raise the level of digital investment in this market.”