A report released on April 12th at the Digital Cream Dubai event compiled by econsultancy and Arabian Business shed’s light on the relative levels of spending for 2011 across a range of marketing channels, comparing online and offline budgets. The report was conducted by surveying over 500 companies from the region between February and March 2011.
The survey included a total of 510 respondents of which 173 were client-side professionals or marketers and 219 were supply-side such as agency marketers and those working for technology vendors or other service providers.
As for the location of the respondents a majority of them were from Dubai, as shown in the chart below:
The chart above gives a good indication of the digital activity hotspots in the MENA region, I think all online and digital activities are mostly situated in the top 5 countries mentioned in the chart.
Among other things, the report talks about what the main obstacles facing marketers in the MENA region to invest more in digital advertising are, and the chart below gives a very descriptive insight:
The top 3 results were:
- Company Culture
- Reliance on traditional marketing
- Restricted budgets
Other than the 3rd obstacle I think most of these obstacles can be overcome by educating the people in charge or the decision makers. I feel a lot of times digital is not taken seriously by upper management (from both the client and agency side) because it is seen as a secondary service or target and is not as lucrative as offline medias in terms of generating revenues for agencies.
Despite the obstacles mentioned above the report states that companies are increasing their overall budgets on average by 23%. This compares to an average of 30% in the UK, according to the Econsultancy / SAS Marketing Budgets Report 2011. Here’s the breakdown:
- The vast majority (91%) expect their budgets to increase by up to 40%
- A third (29%) expect budgets to go up by up to 10%.
- Over half (52%) said they expect an increase of 11% to 30%.
And from those increases it is estimated that companies spend almost 22% of their total marketing budgets on digital and it seems that digital budgets for 2011 will increase by 28% on average. The chart below explains how their digital budget will be split up:
It appears for marketers in the MENA email marketing works best because it delivers tangible ROI via inherently measurable metrics. Social media is also a strong channel, with many companies using social networks such as Twitter and Facebook for marketing. However, fewer companies are incorporating social media features (such as blogs, forums) into their own websites. A couple of big barriers I faced whenever we mentioned incorporating blogs into company websites was:
- Resource availability
- Clients don’t see the value in it
- Clients afraid of negative feedback from customers appearing on live websites/social media profiles
Again all of the problems are due mostly to the lack of education regarding digital, marketers should realize that by adding such tools as blogs they can get customer feedback and be able to provide a better experience. And even if marketers do receive negative comments it is a good opportunity for them to turn the situation around by listening to their customer’s complaints and solve it, I saw a couple of tweets yesterday about a customer complaining about a service and in one of the tweets she mentioned that she will never use that service provider again, but when the service provider replied and listened to what she had to say and then resolved the situation, she actually tweeted saying that they have great customer service and that she will try them again soon. In this example an irate customer was actually transformed to a brand ambassador or even raving fan.
Hi Tariq, This is really insightful keep sharing this amazing stuff. It would be icing on the cake if you can share some insights about average CTR's across the Media MIx
Hi Aliya, It was great to meet you as well. The report was very insightful and I definitely think that the mindset has to change and quickly to adapt to what's going on in the online industry. Hopefully they will be convinced by your report! Cheers!
Hi Tariq,
It was great to meet you at the Digital Cream Drinks reception on Tuesday. Glad to see you found the results useful, and it’s interesting to see the barriers that you personally face when trying to get buy-in for writing blogs.
It’s interesting that you mention fear of negative feedback, as this is something I’ve heard from most of the digital community working in the region. I think social media also requires a change of mindset. We need to educate clients about the value of negative feedback and how to think of it as an opportunity.
If you have a customer with negative feedback and the company responds to try and resolve the problem, then we see that customer loyalty significantly increases. It’s about thinking long-term and creating lifetime customer value, fostering relationships that last.
There’s more information in the full report findings, which members of our site can download here: http://econsultancy.com/reports/the-state-of-digi…
Aliya Zaidi, Research Manager at Econsultancy.
Contact:
Twitter – https://twitter.com/aliyazaidi
LinkedIn – http://linkedin.com/in/aliyazaidi