Digital advertising spend exceeds $100 million in Singapore

The results also showed a strong close to the year, with revenues in the second half increasing 25 per cent compared with the first half, from US$47.7 million to US$59.8 million.

“This is a watershed moment,” Loren Shuster, chairman, IAB Singapore, said. “It is the first time the revenue has moved out of the double digits and crossed S$100 million (US$79 million) since we set out to measure online advertising spend three years ago.”

Shuster is also the country director, Singapore & Emerging Markets, at Google.

IAB Singapore's Singapore Online Advertising Revenue Report for the half year ending 31 December 2011 was jointly commissioned by the Media Development Authority and IAB Singapore. The report was compiled by PricewaterhouseCoopers LLP to provide an analysis of online and interactive advertising market growth and trends.

The total percentage of online ad spend stands at a steady 8 per cent both for 2H2011 and across the full year as a whole. “This reinforces our firm belief that there is tremendous growth potential for online advertising within the Singapore market, and we look forward to closing the gap,” Shuster added.

The growth was also encouraged by significant contributions from new participants such as Tribal Fusion, Clozette and Job Street.

Ranji David, executive director at IAB Singapore, noted that the inclusion of Job Street and other players in the Classified and Directories space reflected a whopping 105 per cent growth in that categor,y from US$4.35 million in 1H2011 to US$8.93 million in 2H2011.

Tenancy has experienced a remarkable increase in market share on the increase in classifieds and display, while CPM and performance continue to be the dominant revenue type.

According to the report, the 23 per cent CAGR for the 24-month period ended 31 December remains driven by search and display, while the share of search has continued to increase over the past three years at the expense of display.

Total online advertising revenues from display advertising grew 23 per cent in 2H2011, while total online advertising revenues from search advertising jumped 11 per cent in 1H2011.

By industry, the financial services beat was the highest revenue industry category with 15.22 per cent share. Travel & leisure, technology & communications as well as business services and property were most dominant sectors online.

Government and public sector spend also jumped 74 per cent from 1H2011 and outspending automotive, healthcare & pharmaceuticals as well as food & beverages.

“Digital advertising is now firmly embedded in businesses' marketing strategy across industries,” Greg Unsworth, Singapore technology, infocomm and entertainment & media industry leader at PwC LLP Singapore, said.

“The real challenge ahead for advertisers is to find innovative ways to redefine advertising and come up with new ways to expand value proposition to the customer. And ultimately, being able to convert online time and spending to revenue.”