Digital marketing to flourish: Facebook

Digital marketing to flourish: Facebook

Mr Wagner says the proportion of digital ad spending could reach 30% in a few years.
Mr Wagner says the proportion of digital ad spending could reach 30% in a few years.

Digital marketing opportunities in Thailand can expect to reach US$1.41 billion over the next few years, given the gap between digital communication consumption and spending.

"Despite Thai consumers spending almost half of their waking hours using their mobiles and other communications devices, the digital ad budget still accounts for a low proportion of total ad spending," said John Wagner, managing director of Facebook Thailand, the local operating unit of Facebook Inc.

Mr Wagner said Thailand's digital ad industry has yet to reach a tipping point, as marketers lack crucial digital skills to synchronise marketing and products.

Digital ad spending in Thailand accounts for only 1% of the total, while Thais spend 48% of their time online.

"This represents a huge gap between consumption and spending," said Mr Wagner, who took the top post at Facebook Thailand last September.

"But this also provides vast opportunities to the local ad industry."

Global professional service firm PwC says Thailand's internet advertising has the second-highest growth in Asean countries, with a compound annual growth rate of 22.5% during 2016-2020 and will reach $89 million by 2020.

Mr Wagner said the proportion of digital ad spending in Thailand can reach 20-30% of the total over the next few years, on par with developed countries, as companies move increasingly towards online channels to tap digital consumers.

Top digital ad spenders include retail and e-commerce companies, telecom, automotive and financial industries.

Research conducted by global market research firm Millward Brown found that Thais spent 105 minutes per day watching videos on their mobile devices in 2016, compared with the global average of 65 minutes.

With Facebook's own video sharing platform, Facebook Live, it has seen an increase of more than three times in 2016.

As of Sept 2016, Thailand had 44 million people using Facebook every month, a 22% increase year-on-year. Up to 95% of total Facebook users accessed the social network platform via mobile devices.

Another report by global research firm eMarketer says Thai consumers spent 160 minutes on mobile devices per day in 2015.

A report by Visa says that one of two Thais purchased products and services online via smartphones in 2015.

Mr Wagner said Thailand's online retail market is expected to account for 15% of total e-commerce by 2024, according to a Bain & Co report.

Thailand's e-commerce market grew by up to 20% to 240 billion baht last year.

To embrace the opportunity mobile devices present, Mr Wagner said digital marketers need to adopt methods to communicate through video advertising and understand consumers' online path to purchase before calibrating business results.

The Digital Advertising Association (Thailand) also reported that Facebook accounted for 26% of Thailand's digital ad spending in 2016 with 9.8 billion baht.

Local digital ad spending in 2016 grew by 49% from 2015.

"Facebook has played a big role in driving businesses in Thailand to embrace technologies to communicate and connect with their customers," said Mr Wagner. He declined to comment on the government's consideration of a corporate income tax on international technology firms.

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