Online advertising needs more attention: experts

August 12, 2016 | 08:59 am GMT+7

Online marketing in Vietnam is entering a period of rapid development, but this development continues to face obstacles, including consumer confidence, payments and online marketing, according to a report.


The report was published in Vietnam e-Business Index (EBI) 2015 and made public at a recent press conference to introduce the Vietnam Online Marketing Forum to be held late this August. The EBI 2015 was based on a survey among 5,000 enterprises across the country, up nearly 50 percent, compared to 2014. 

According to Nguyen Thanh Hung, chairman of the Vietnam e-Commerce Association (VECOM), the EBI 2015 indicated that the number of e-commerce transactions grew sharply against 2014 and transactions were diversified. However, e-commerce businesses have yet to work out effective solutions to win consumer confidence. 

Tuan Ha, CEO of Vinalink said online marketing has seen a rapid increase. In 2015, to better serve customers, businesses invested more in applications for e-commerce on mobile phones with a growth of 200 percent. Many online marketing agencies have been used by sellers such as Facebook, Google, and Over-The-Top (OTT) application. 

According to a survey made by VECOM, government agencies and businesses (G2B) have made significant progress. Some 26 percent of websites launched mobile platforms last year. However, they lacked able human resources and did not pay much for the e-commerce performance. 

Under the survey, 95 percent of businesses used email in their business activities. The ratio of businesses using email to make business contracts has been growing in the last three years while the ratio of businesses using email to advertise or introduce their products has been going down. It clearly reflects a new trend in online advertising. 

Some 53 percent of surveyed businesses said they spent below 10 million VND (444 USD) on online marketing, or equivalent to 2014. It said 12 percent of surveyed businesses spending more than 50 million VND on online marketing. 

The most popular marketing social channels are social networks, search engines, e-newspapers and emails. Marketing through search engines has been rated as the one with highest efficiency. 

Some 30 percent of businesses said advertisements on search tools gained high efficiency. It is 25 percent of advertisements on social networks. Only 14 percent of surveyed businesses said that advertisements on mobile phones brought high efficiency, while 38 percent of surveyed businesses said advertisements on mobile phones brought low efficiency. 

This result was similar to the Nielsen Global Trust in Advertising Survey, Q1 2015. The report showed that Vietnamese consumers believed mostly in advertisements on search engines. It is followed by social networking, online videos, online banners, while the lowest ratio is on advertisements on mobile devices. 

Nguyen Trong Tho, CEO of iNet said Facebook video commercials have been very effective for sellers and are better than image advertisements. 

According to industry insiders, online marketing has an intimate relationship with online shopping, but many Vietnamese firms do not pay their attention to this. Some businesses have already used online marketing services but it has seen low efficiency. On the other hand, Vietnamese businesses still largely depend on a small number of providers for cross-border advertising services. The local market share of online marketing is quite modest. 

According to eMarketer, an independent market research company that provides insights and trends related to digital marketing, media and commerce, the global spending ratio for online marketing account is high, and this spending is growing. In the Asia-Pacific region, this ratio was 32.3 percent in 2015 and it is estimated to increase by 36.3 percent in 2016. 

EMarketer predicts that this year, spending on online marketing will reach 2.9 billion USD in Thailand, 2.7 billion USD in Indonesia, and 7 billion USD in India. In the United States, online advertising will increase 15.4 percent this year and will achieve sales revenue of more than 68 billion USD, accounting for 32.6 percent of the entire advertising market 

To spur online marketing, industry insiders said businesses need to pay much attention to investment, strategy, and product. The success in online marketing is to maintain connection with customers and sell products on their e-commerce websites and social networks.