Malaysian brands not spending enough online

Yahoo’s latest Net Index study reveals something most of us with kids know already – Malaysians are spending record amounts of time on social networks. The report states that the time spent by Malaysians on social networks increased 29% in 2010.

As well as social media, file sharing, online searches, email and chatting all saw an increased activity. The number of purchases online also grew so you would expect Malaysian CEOs to be spending more money online right?

Well yes, and no. Advertising spend in 2010 grew to RM7.7 billion (US$2.6 billion) a YOY growth of 16%, but of that only RM52 million was spent online. Up a respectable 29% over the previous year but still not enough.

The rest was spent on traditional media with newspapers capturing 51% or RM3.9 billion of total ad spend. This is an increase of 14% despite the fact that readership of all newspapers is declining.

With consumer confidence falling it is going to be hard to sustain such gains and traditionally, when the economy falters, advertisers will seek accountability.

My hunch is that we’ll see a huge jump in online advertising with traditional media – newspapers, TV, radio, Out of Home and magazines all taking the biggest hit.

Data from the Nielsen company

Media

2009 spend (RM ‘000)

Percentage Share

2010 spend (RM ‘000)

Percentage Share

Percentage change

Newspapers 3,407,826

51.5

3,890,824

50.8

14.2

TV 2,446,536

37.0

2,892,472

37.7

18.2

Radio 361,818

5.5

408,871

5.3

13.0

Magazines 139,545

2.1

151,735

2.0

8.7

Outdoor 112,250

1.7

119,745

1.6

6.7

In-store 86,300

1.3

123,620

1.6

43.2

Internet 40,446

0.6

52,149

0.7

28.9

Cinema 22,496

0.3

23,811

0.3

5.8

Total 6,617,217

100

7,663,227

100

15.8

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