Seismic shift in MEA online adspend

Warc, 15 August 2014

DUBAI: Online adspend in the Middle East and Africa is set to grow at a compound annual growth rate of 27% over the next five years according to a new forecast which says the region's advertising is undergoing a "seismic shift".

A report from IDC, New Media Market: Internet Advertising Spending in Middle East and Africa in 2013 and 2014–2018 Forecast, attributes this dynamism to rising internet penetration and the growing economic affluence of the region's consumer base.

Rising disposable incomes have meant that consumers are better able to purchase mobile devices, while falling data tariffs encourage more internet use. That in turn attracts more advertisers targeting these consumers.

In particular, the growing number of small and medium-sized enterprises in these markets are expected to take advantage of the low-priced advertising options now available – such as Google Adwords or Facebook Ads – that allow them to target customers more cost-effectively than via traditional media.

"In this sense, the Internet has 'democraticized' advertising, as it is no longer absolutely necessary for businesses to have huge funds at their disposal in order to hire expensive advertising agencies or marketing firms," said Sony John, program manager for telecommunications and media at IDC Middle East, Turkey, and Africa.

He added that there had been "some cannibalisation of traditional media advertising, particularly print, [but] the widening participation of smaller organisations in the advertising space has more than made up for it."

IDC expected that mobile search and mobile display would be the fastest growing advertising formats, with CAGRs in excess of 50%, while online display and online search would continue to attract the highest levels of spending.

John thought there was scope to educate businesses and drive even greater growth. "There remains an overall lack of clarity among organizations around the different internet advertising options that are available to them," he said.

"Ad publishers can help drive this growing phenomenon even further by investing more in generating awareness of the different advertising possibilities that are available online, particularly in relation to the flexible pricing and payment options that can be tailored to meet an organisation's specific budget and needs."

Data sourced from IDC; additional content by Warc staff