Middle East lags global mobile advertising trend: report
Low rates of mobile advertising present major opportunity
Companies in the Middle East are significantly behind the rest of the world when it comes to spending on mobile advertising, according to a report from BPG Group and Deloitte Middle East.
The MENA region accounted for less than 0.1% of mobile advertising globally despite receiving 6% of global smartphone shipments in 2012, the report stated.
Companies across the region are behind global trends, allocating just 6% to7% of their advertising budget on digital.
Furthermore, only 2% to 3% of the digital budgets of Middle East companies is allocated to mobile and tablet advertising.
Of the companies that are using mobile advertising, the vast majority are at a nascent stage of their mobile advertising strategies, according to the report. Indeed, 80% of the brands in the MENA region who are engaged in digital advertising are still in the infancy stage of the brand lifecycle, and this means that they have some way to go in terms of engaging with their customers, the report stated.
But from this low base, the report suggests that mobile advertising is likely to see significant growth in the second half of 2013 and into next year.
Gregory Bolle, strategic planning head for the BPG Group, and Emmanuel Durou, Deloitte Middle East's director of strategy consulting, added that the opportunity to use mobile advertising is being "under-exploited by advertisers across the region."
He said: "Being at the beginning of the brand lifecycle means that many MENA brands continue to promote themselves as product brands or trademarks rather than a corporate or experiential brand. A lack of digital understanding is driving marketers to push messages out to their customers instead of engaging with them in conversation or debate, and this is the case for more than 80% of the brands in the MENA region. In addition to this, a shortage in quality Arabic content is slowing down the expansion of mobile advertising in the region."
Emmanuel Durou added that companies have "only just scratched the surface of the mobile advertising opportunity" in the region. "Globally, companies have now started to figure out what works and what does not work in mobile advertising as evidenced in the exponential growth of Facebook's mobile revenues in the past 12 months.
"In the region however, the value of online advertising is 40 times higher than mobile despite the number of apps users we have here being on a par with Internet users in some of the countries including the UAE, and the high penetration of smartphone and tablets across MENA," Durou added.