Digital ad spend slows amid economic headwinds

According to the Digital Advertising Association Thailand (DAAT), economic strife is expected to reduce the growth rate of digital advertising spending this year to 7%, or about 26 billion baht, from an 18% rise last year.

“Digital ad spending continues to grow, but at a slower pace due to the impact of the economic downturn and inflation, which has led to more cautious spending,” said Nongnoot Poungpong, chief strategy officer. brands at Kantar Insight.

Speaking at an annual event titled ‘DAAT Day 2022 Era of Effectiveness’, she said Thailand’s digital ad spend in the first half was valued at 13 billion baht, while the second half is expected to increase slightly to 13.6 billion baht as the fourth quarter is the peak period for e-commerce spending.

The top five categories were motor vehicles (12%), soft drinks (9%), communications (9%), skincare (9%) and dairy and dairy alternatives (6%) .

Retail stores and banks were ranked as the biggest spenders, as they were in 2021, while audio and visual electronics grew 241% and e-commerce business grew 57%.

In terms of channels, Meta, which merged Facebook with Instagram, still held a dominant share of 33%, followed by YouTube Ads with 15%, online video at 10%, other social media with 9%, while Line and TikTok Ads had 6% and 3% shares, respectively.

Online video has steadily grown and overtaken social media in third place.

Pacharee Permvongusawa, managing director of Publicis Media and a member of the DAAT committee, said video platforms have seen phenomenal growth, mainly driven by TikTok and its 42 million users.

Ms Nongnoot said around 92% of Thai consumers have watched video content, while 72% have discovered products and services through this medium, according to a 2020 MediaBrix study.

Rajsak Asawasupachai, managing director of IPG Mediabrands, said digital has become the way for businesses to reach out to the mass market, rather than through traditional media.

The goals of digital advertising in 2022 were primarily to create brand awareness and drive customer engagement.

Paruj Daorai, President of DAAT, said the pandemic has accelerated the digital transformation process from 4-5 years to 2-3 years.

A total of 79% of Thais use the Internet, an average of nine hours a day and at an average mobile speed of 32 Mbps.

Around 94% of Thais over the age of 13 have social media accounts and play games for an average of 1.58 hours a day, while 16% of Thais aged 16-64 use e-commerce and a third of them have mobile banking services.

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