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. Generally companies in the UAE allocate only 15% of their budget to digital activity and only 6-7% across the whole MENA region.
The BPG Group and Deloitte Middle East have said they expect mobile advertising in the region to increase significantly in the second half of this year and into 2014.
That is according to insights from local and regional brands and the findings of Deloitte's most recent report 'Technology, Media & Telecommunications Predictions 2013 Middle East'.
Gregory Bolle, Strategic Planning Head for the BPG Group and Emmanuel Durou, Deloitte Middle East's Director of Strategy Consulting, explained at a recent media briefing, "Mobile advertising volumes in the MENA region remain significantly behind global trends and explained why this believe this opportunity is being under-exploited by advertisers across the region."
Emmanuel Durou, said, "We 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," he added.
Gregory Bolle, BPG Group, added, "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."
As well as the insights included in the report, the BPG Group also conducted a short survey among some of the UAE's top brands. The results revealed that 70% of the brands questioned think that tablets and smartphones are likely to generate more e-revenues in the next two years, and are at the top of their priority lists.
A total of 60% of these brands acknowledged that they were at the early stages of their digital lifecycle, either creating a website or application. In 2013, 80% of these brands in the UAE anticipate that combined budgets for mobile, smartphone and tablets will increase but will still be less than 10%.
Both the BPG Group and Deloitte agree that the current low level of digital and mobile advertising revenues in the region is a market anomaly and there is significant opportunity for growth, considering that all market drivers are aligned to drive mobile advertising into a new phase.
Brands have the potential to grow mobile advertising even faster if they are more content driven and become brands of proposition rather than brands of opposition. Brands of opposition simply put more effort behind defining who they are and what they believe in, rather than continuously battling against competitors.