What are the Major Challenges in the Malaysia Online Advertising Market?
The major challenge to this industry has been a shortage of skill, most of the c level positions in the industry are occupied by expats and even at the lower levels it is difficult to fill the positions on an urgent basis. The lack of training and education in this sector has Lack of the right in-house skill sets and expertise. Compared to the level of development of the country, Malaysia still lags behind in terms of digital infrastructure. Due to the availability of large number of advertising agencies in Malaysia, it is difficult for the agencies to retain their clients due to stiff competition. The agencies compete in terms of charges or rates, unique services such as brand reputation management, web design and app marketing and others. The agencies need to bring creative ideas and customized service in order to increase the client retention rate in the market. High expectations of the advertising agencies in terms of ROI in short period of time creates another hindrance in Malaysia Online Advertising Market. Generally, advertising industry takes long to payback the investment or generates ROI. But it has been observed the advertising agencies in Malaysia are keen to generate ROI in short span due to the fact that their customers are heavily investing in digital marketing and want to see results. Limited talent and expertise of advertising agencies is a big challenge in the market. Malaysia advertising market is dominated by traditional mediums such as T.V., newspapers, radio and others and digital is
Competitive Landscape in Malaysia online advertising Market
The overall competition stage of the industry has been a ~ in terms of advertising spent and market share of major platforms with the presence of large number of small agencies and platforms in 2018. Few of the major advertising agencies include Omnicom, IPG Medibrands, Publicis, Dentsu, Group M and many others. The major parameters on the basis of which the advertising agencies in the market compete with each other are revenue generated, number of full time employees, and number of active clients, client retention rate and the major clients along with pricing. These have helped the major advertising agencies to assemble higher market share during the review period. The online advertising platforms are competing with each other on the parameters such as market share, users, time spent on platform, gender profile users, brands or clients, age group and others
What is the Future of Online Advertising Industry in Malaysia?
The Malaysia online advertising spent has been anticipated to grow registering a moderate growth during the period 2019 to 2023E with a CAGR of close to ~% in terms of advertising spend. This advertising spend will be supported by the increasing number of internet users which is expected to grow with a CAGR of close to ~% during 2018 to 2023E. Growth during this period is expected to be supported by the rising number of smart phone users, increasing usage of social media networks, well developed digital infrastructure, diversifying services portfolio and others. Increase in literacy rate would supplement growth in the market. Due to the expansion of the already existing advertising agencies and the establishment of many other agencies, the penetration percent of the online advertising will increase in future. Many new services and new technologies are expected to be launched in the forecast period having a positive impact on demand for online ads. The increasing number of international brands in Malaysia would have a combined effect and increase the number of online ads with during the forecast period. The future share of medium of online advertising such as desktop and mobile in the Malaysia online advertising market is expected to change in favor of mobile by 2023. The scenario is improving for mobile ads because of the increasing usage of smart phones and low cost incurred in mobile advertising.
With the increase in the time spent on internet, higher awareness among the people due to high literacy and increasing number of social media users, the penetration rate of the brands into online advertising market is expected to increase in the future. Due to this, there would be an increase in the conversion rate, which is anticipated to grow at a CAGR of ~% from 2018 to 2023. The penetration of the internet users is expected to rise by ~% in 2023. This rise in the internet users is due to establishment of robust digital infrastructure that enables for fast downloading and high speed broadband networking in Malaysia.
In addition, increase in the number of players in different sectors in Malaysia will encourage brands to go for digital advertising in order to cope with the competition.
For more information, refer to below link:
Oman Online Advertising Market Outlook to 2023 – By Medium (Desktop And Mobile), By Type (Search Advertising, Social Media Advertising, Banner Advertising, Video Advertising, Online Classifieds), By Sectors (Hospitality & Tourism, FMCG, BFSI, Telecommunications, Healthcare, Automotive, Retail And Others) And By Model (Cost Per Mile, Cost Per Click And Cost Per Action)
Singapore Online Advertising Market Outlook to 2023 – By Type (Search Ads, Social Media Ads, Video Ads, Banner Ads, Online Classifieds And Others), By Type Medium (Desktop, Mobile), By Sectors (FMCG, Entertainment & Media, BFSI, Automotive, Retail, Healthcare And Others) And By Models (Cost Per Click, Cost Per Mile And Cost Per Action)
Ankur Gupta, Head Marketing & Communications