APAC social media advertising to increase

Region's companies lag behind Western counterparts in social advertising, partly due to lack of skilled professionals, but Buddy Media CEO believes Asia's ad spend on social platforms will pick up in next two years.
Written by Liau Yun Qing, Contributor

There is a "disconnect" between advertising budgets spent by Asia-Pacific companies and ad agencies on social media and the time people are spending on these online platforms. This situation will change for the better in the next two years though, according to a new study by Buddy Media.

Released Tuesday, the study showed that 66.4 percent of the region's companies and advertising agencies are currently spending less than 5 percent of their ad budgets on social media platforms, while 23.2 percent indicated that they are spending between 5 percent and 15 percent.

Commenting on this, CEO Mike Lazerow said during an interview on Tuesday that there is a "disconnect" between the portion of ad spend and time users are spending on social media. There were no statistics to show how much time people are spending on these online platforms though.

He went on to note that Asia-Pacific companies have plans to up their expenditure on social advertising in the next two years however. Some 43.2 percent of respondents said they intend to spend between 5 percent and 15 percent of their ad budgets on such platforms by 2014, while 20 percent indicated between 15 percent and 25 percent, the study showed.

Lazerow noted that spending between 15 percent and 25 percent of advertising budgets on social platforms is more "appropriate" and in line with the time consumers are spending on social media.

Buddy Media's online survey polled 125 respondents from 18 Asia-Pacific countries during a one-week period between May 14 and May 21, 2012. These countries are Australia, Bangladesh, China, Hong Kong, Singapore, Sri Lanka, South Korea and Thailand, among others.

The CEO also pointed out that the region reflects is about six months behind the United States and Europe in social advertising. One of the main barriers to growing the industry is in hiring the right people to manage social advertising initiatives. This is because there is currently a lack of skilled professionals capable of managing two-way conversations with consumers online and creating content for the different social sites, he explained.

Lazerow believes the six-month gap will soon "fly by" and regional companies are expected to catch up with their Western counterparts soon.

Social advertising effective
When asked how effective social advertising is, considering a recent Reuters report stating that 4 out of 5 Facebook users have not bought a product or service based on advertising on the site, Lazerow said: "Facebook doesn't have the monopoly on people ignoring ads."

He added that "it is good" people are not noticing Facebook ads as this means such advertisements are integrated in their social media experience and not distractions. Furthermore, Facebook ads that receive "likes" from those in one's social circle get four times the attention than an add that did not receive any, he stated.

Betting big on "social marketing cloud"
The CEO declined to share more on how Buddy Media will be integrated into Salesforce.com following the acquisition announcement, saying that the deal will only close in the third quarter.

The software-as-a-service (SaaS) vendor revealed its intentions to acquire the social marketing software company for US$689 million last Monday.

He did note that both companies are betting on "social marketing cloud", or on-demand social marketing services. By combining Salesforce.com's other acquisition, social media monitoring service Radian6, and Buddy Media's social enterprise tools, the CEO believes the SaaS vendor will have a unified, social marketing service platform.

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