Digital ads deliver more bang for their buck, but for how much longer?

Internet Retailing

25th May 2017

The cost of digital advertising in the Asia-Pacific region continues to rise, with search costs increasing at two times the rate of inflation.

But websites are still getting more bang for their buck, as site visits driven by search have increased over 30 per cent, according to new research from Adobe Digital Insights.

In a report on the state of digital advertising released this week, the software company has revealed that search remains a tried-and-true channel for acquiring site traffic, but that will likely get harder. 

It currently costs more to get less traffic in the US, which may be a harbinger of things to come. 

In addition, the report revealed that Australian brands are grading their digital transformation more generously than consumers.

“More than half of Australian marketers surveyed believe they’re doing a better job at delivering valuable, personalised ads compared to two years ago, however, only 38 per cent of consumers agree,” said Adobe Digital Insights principal analyst, Tamara Gaffney.

“Even with the great strides already taken to provide more relevant advertising, consumers are expecting even more, underscoring the opportunity for marketers to leverage the data they have to better understand the needs of their customers.

“Australia is among the top countries with consumers switching from internet browsers over to smartphones. Success in advertising absolutely requires brands to engage these mobile consumers, but our report found that 78% of brands underinvest on smartphone advertising.

“Marketers cannot keep up with the complex multi-device, multi-channel digital advertising landscape. The best way to target across all the options is to use technology optimisers to ‘programmatically’ select the most relevant placements,” Gaffney said.

Other key findings for Australia in the report include:

• 66 per cent of Australian brand marketers claim accurately measuring return on ad spend is the biggest challenge to media buying
• Older Australian consumers (35+) are most likely to be engaged by funny ads (40 per cent), while consumers in India (49 per cent) and Korea (43 per cent) prefer ads to focus on product benefits

Key findings for Asia-Pacific include:

• Total visits to websites in the region have grown 36 per cent in the last 36 months, but growth is slowing; total website visits in the US is stagnant
• The opening seconds of a video ad are crucial; 22 per cent of APAC consumers move on after a video ad has played for just five seconds, higher than US consumers at 19 per cent

“Marketers looking for growth in visits or revenue are faced with increased costs with declining results. The integrated data platform combined with programmatic media buying solution, is an absolute necessity,” Adobe ANZ head of Adobe Advertising Cloud Sam Smith said.

“With consumer expectations rising and advertising channels becoming more complex, advertising and data must go hand in hand. The opportunity for marketers to bridge the martech and adtech divide is the only way to enable marketers to understand what’s working best for their customers, and take action.”