It is not news that online media consumption in Singapore is amongst the highest in the world with its smartphone and broadband penetration. It is news, however, that the proportion of digital spend is significantly lower.
In numbers, Singapore consumers spend 40% of their time on digital media every day whereas only 15% of advertising budgets were online. Singapore lags behind Japan, China, USA, UK, UAE amongst others on this metric.
PwC in one of its surveys cited key inhibitors which cause this lag in online advertising growth relative to consumption.
The first, and what I think is the most important one, is the poor understanding of measurement metrics online. As an online marketing professional focused on performance, I think a razor focus on campaign KPIs is critical for growth.
A three-step framework can help online marketers address measurement challenges - (a) KPI identification and target setting, (b) Tracking & attribution model set-up, and (c) Reporting & optimisation.
It is important for organisations to identify their goals with digital advertising. For example, ecommerce companies tend to focus on orders at a certain cost per order or customer acquisition at a certain cost of acquisition.
More sophisticated companies choose to focus on maximising lifetime value of customers net of cost. When identified correctly, companies will have a greater understanding of what needs to be tracked.
Customer journeys are long and winded for considered purchases. They will traverse the web, interact with you multiple times across touch points and even devices before deciding to buy, or in our online marketing speak – converting.
When journeys are long, it becomes important to reasonably attribute credit for the conversion across touch points including paid (ad views, clicks) and unpaid media (organic search / social media traffic).
Tracking views can still be challenging across various media and devices in a cost-effective manner, but clicks are easier to track on desktops. Various pre-built attribution models exist on popular analytics solution providers.
A popular one is the U-shaped or position-based attribution model which allocates more credit, say 40%, to the first touch point which drove awareness, 20% credit to middle touch points which drove consideration, and 40% credit to the converting touch point which drove action.
Setting up tracking and an attribution model on some popular analytics solution providers is simpler than people sometimes perceive.
Reporting is usually integrated in these platforms and provide insights on what media is contributing most to the conversions and at what cost per conversion. These insights can be used to improve and re-allocate budgets across media.
Good reporting literally gives you a chance to have more bang for your buck, since you can optimise spend on the data. Regular optimisation is often the most critical component of achieving success in online marketing.
Factors such as seasonality, intra-day patterns, weekday versus weekend patterns also play a strong part in optimisation decisions.
Other concerns cited were lack of talent, slow mind set shift, and the ease of using traditional media. Singapore has amongst the best quantitative and technical talent in the region.
True, talent with experience in digital advertising would be tougher to find, but the approach sun-rise industries generally take is to find motivated and driven talent with relevant skillsets and believe in them to learn and figure things out.
Marketing leadership in most organisations in Singapore are now actively working on digital strategies and budgets. Most ad tech companies are locating their regional headquarters in Singapore and are strengthening their support teams here to serve clients better.
I think mind-sets are already shifting and it is a matter of time before it starts showing up in the numbers.
Measuring advertising results was never easy. In today's search-driven and socially connected world, the opportunity to evaluate digital marketing performance exists.
That alone makes it worth the effort required in understanding it and setting it up. If there's one thing history has shown about Singapore, is that in due time, the world's first start-up country will catch up and, I daresay, even outpace other countries in digital marketing.
The views expressed in this column are the author's own and do not necessarily reflect this publication's view, and this article is not edited by Singapore Business Review. The author was not remunerated for this article.
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Kaushal is Head of Online Marketing with Zalora regionally. His career in the internet space began with building an award-winning travel mobile-app start-up, and then he headed new product development and online marketing for 123Greetings.com. He is an MBA from the Indian School of Business, winning the Young Leader Award there, and a dean’s list graduate in Business from Singapore Management University.