Trends to watch in digital media

ZenithOptimedia predicts global 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 and 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 expect to see advertisers become more demanding and cautious 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:

The bandwidth boom

The South African internet service provider market has just 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 telecomms regulations should also create more competition in the internet service and telecom infrastructure markets.

The end result is that more South Africans will have access to cheaper broadband internet services that they will use for more and more applications. The size of the market that advertisers can talk to using the online channel will grow significantly and many people will start spending more of their time on the internet and less with alternatives such as television and print.

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 US$500-million by this date.

Increasingly, users in South Africa are getting their hands on smartphones that boast easy-to-use interfaces, high-speed internet access and large colour screens.

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 to take off

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.

The reason for this is that these ads are engaging and better able to capture the user's attention in a cluttered media landscape. As the broader advertising and creative communities start to take more notice of the online medium, we can also expect to see much more creativity - both in format and content - come to the fore.

Catching up with behavioural targeting

Another international trend that local marketers have lagged behind in 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.

Many advertisers have felt that the South African web environment is too small to support effective behavioural marketing because the concept works best when there is a big pool of users and web sites. But the growing number of users and sites in South Africa is making the concept more attractive every day.

More careful market segmentation

A combination of a 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 to ensure that they are targeting the right message to the right user at the right time and in the right environment. This may include focusing on more heavily specialised sites within large portals or advertising more heavily in niche media.

Focus on social media

Barack Obama's successful use of social media channels in his presidential campaign earned him Advertising Age's Marketer of the Year 2008, so we can definitely see that social media is moving into the mainstream.

We can expect social media to be even more of a focus as organisations 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. What's more, a recessionary mindset means that companies count every penny that they spend and make sure that they're getting bang for their buck.

This means companies will start measuring the results of every campaign more carefully and use more sophisticated tools to track return on investment (ROI).

Resource and budget allocation will increasingly be determined by the contribution campaigns have made to ROI in the past.

As managing director of Acceleration Media, Diane Charton oversees the growth of South Africa's leading digital media strategy, planning and buying company, and helps clients to maximise their use of the Internet.

For more information, visit www.accelerationmedia.co.za.