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Guest Times: Why are all the cool kids only talking about digital advertising?

Dhruv Sahgal, Co-Founder, Business Operations, EatAds.com, argues that if we dig a little deeper and look into how traditional media is bought and sold, one can find many gaps   

January 17, 2013

Dhruv Sahgal

Despite the Internet being around for just over two decades, its impact, from an advertising perspective, has been revolutionary. Ad dollars now are flowing by the billions into online marketing where terms like CPM (Cost per 1000 Impression) and CPC (Cost per Click) are common in advertising. However, it is interesting that Internet ad-spend for both mobile and wired is still far less than what is spent on traditional media (Out-of-Home, Print, TV and Radio).

According to PWC’s Global Entertainment and Media Outlook: 2012-2016, Internet and Mobile advertising in 2011 was only around 18 per cent of total ad-spend in 2011 and projected to be just under 20 per cent in 2012. This leaves nearly 80 per cent of the other ad dollars spent in traditional media! This same report projects that Internet and Mobile advertising will barely reach 30 per cent by 2016. Though the growth is strong in the online segment, it still is not as big or hyped up it’s made out to be.

There seems to be an obvious gap here, but also an obvious opportunity. If we dig a little deeper and look into how traditional media is bought and sold, we uncover some interesting insights.

In general, the MNCs of the world will tend to use big media agencies to help them find the right avenues to advertise. Media agencies assist in creating a campaign, planning the various distribution channels, and executing the media plan.

While the creatives deserve every bit of credit in fashioning the intended message, the purchasing of media space often resides in a grey area. An MNC has no way of looking for or discovering advertising distribution channels on its own with the exception of the digital space. There is no centralised location to see who owns that billboard in Lan Kwai Fung or how many luxury magazines exist in India or the viewership stats for Indonesian TV. The MNC relies solely on the media agency to ensure their ad dollars are spent efficiently and through the right distribution channels. Often times, despite the sizable budget, MNCs receive neither transparency nor measurable value for money.

What if you’re an SME looking to advertise your new widget you’ve just manufactured and can’t afford the steep commissions of top agencies? Trying to book advertising space locally or abroad by oneself is just like trying to find a house, book a flight, or source a supplier for steel in China without the Internet.

Traditional advertising is ripe for change.

It’s surprising that the Internet has transformed and revolutionised so many industries yet the latest technology to revolutionise the traditional advertising industry is still the humble telephone. This begs the question to why nothing is being done to address this obvious problem for advertising.

After having identified this gap in the market, the team at EatAds.com is out to address this problem. Our website aims to be the online platform for all forms of traditional media where you can search for your offline media opportunities in Asia to find, compare, plan and even make an offer.

Traditional advertising is just one of the inefficiencies that exist today and there are plenty of opportunities out there for the brave to venture into solving. To quote Sir Richard Branson, “Business opportunities are like buses, there's always another one coming.”

 (Dhruv Sahgal spent most of his childhood in Singapore and went on to Northeastern University to graduate with a degree in Electrical Engineering and Business. During his undergraduate stint, he worked for Merrill Lynch in Hong Kong and Scotia Bank in New York. Moving back to Singapore to work one year with The Royal Bank of Scotland, Sahgal’s big ambitions, inclination for tech, and restlessness led him to join the world of tech startups. He is a problem solver who likes to use technology to create a more efficient world.)


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