Egypt – Advertising’s Uncharted Territory

Aspiring online publisher Aline Kazandjian is hoping to launch a web-based magazine this year that will focus on beauty, health, travel and cuisine for internet-savvy Middle Eastern women.

The 48-year-old Egyptian, a former magazine editor and newspaper writer, is banking on a massive regional surge in the web’s popularity to help make her site a commercial success.

But to get there, she needs to convince advertisers that online campaigns are a good way to reach consumers.

“I really don’t know how the advertising will go,” says Kazandjian, a former editor at the local style magazine Pashion and contributor to the Los Angeles Times newspaper.

“I must tell you though that I’m not too optimistic. I’m afraid that advertisers don’t believe they can get enough exposure through a website.”

Kazandjian is not the only internet entrepreneur who has struggled to drum up demand from advertisers. Online marketers say businesses in the region remain largely unconvinced of the internet’s potential; only 1% of advertising dollars in the Middle East are allocated to web ads and campaigns. This is despite the fact that number of internet users in the region is growing quickly; in Egypt their numbers increased almost 40-fold in the last decade.

There are signs, though, that things are slowly changing. As internet penetration rates rise, companies are starting to appreciate the reach, flexibility and cost-effectiveness of internet advertising. Marketers believe the percentage of advertising budgets allocated to online initiatives will hit 5% in Egypt by the end of 2010, jumping to around $32.5 million (LE 178 million).

One of the chief problems companies have with online advertising is that they don’t know always know where their money is going: a rotating banner ad on a website is a lot less tangible that a half-page spread in a newspaper. Experts say firms are also unsure about whether people are actually seeing their ads and whether web advertising yields results.

Con O’Donnell, managing director of Sarmady, an online and mobile marketing company owned by Vodafone, says firms shouldn’t be so worried. Surfing habits are easy to track, as are the number of times people visit product websites or click on advertisements.

“I [can] tell the advertiser how many times their ad appeared, how many people clicked on it, how many people watched their video, how many people played their game or how many people downloaded [their] ring tones,” says O’Donnell. “[Companies] can easily measure their return on investment.”

The online model is also tremendously flexible. Unlike print or television ads, with a click of a mouse companies can update their web campaigns, contests, interactive games and social media sites, such as Twitter, Facebook and YouTube. Like television and print, web ads can be targeted to certain demographics depending on the website or search topic they’re associated with.

The immediacy of the web can work in a brand’s favor by always giving consumers something new. Advertising on websites or mobile phones is also much cheaper than television spots or magazine covers, allowing firms to take risks that they wouldn’t in conventional media.

The idea isn’t to stop advertising in newspapers, magazines or television, it’s to supplement what companies already do with campaigns online.

Living Online

A report released by the Ministry of Communications and Information Technology in December shows there were 13.9 million internet users here in August 2009, compared to just 300,000 a decade ago. Much of those web surfers sit in a key growth demographic; according to research by Nielsen Egypt, 51% of the people online are between the ages of 15 and 24.

Despite the fact that Egyptians are clearly online, few homegrown companies have taken web advertising as seriously as their international counterparts.

Firms are still under the impression that the web is about banner ads and websites, but nothing could be farther from the truth, say experts.

Online advertising is about going viral — having people spread the word about your products via email, social networking sites and message boards. It is also a tool that can be used to build relationships with consumers by offering online coupons, contests, online gaming and instant information through weekly newsletters, blogs and more.

While the majority of large domestic companies have websites, few are creating their own content, online games or social networking accounts.

Juhayna Food Industries, on the other hand, has welcomed the digital era by making its website more than an information portal.

While there, users can look at healthy recipes, trace the production cycle from farm to supermarket and find out about nutrition. This lets customers interact with the brand in ways print and television don’t allow.

Most small and medium-sized companies, though, have no presence online. Ahmed Gamal El-Din, Egypt and Levant sales manager for Connect Ads, an advertising subsidiary of LinkDotNet thinks these firms are waiting for bigger companies to embrace web ads before they get on board.

“It’s a new medium for many of them and they don’t know where to put their money,” El-Din says.

“It’s human nature to resist change.”

El-Din and his sales team believe their combination of high-traffic, customized Egyptian websites — such as Masrawy.com and Otlob.com — and tailored internet mini-games lure in surfers and make it easier to convince companies to give online campaigns a chance. (Masrawy.com alone sees 3.3 million visitors every month.)

The company grew 30% in 2009 and is looking at an even bigger 2010, says El-Din hinting at a big deal with another global internet advertiser that could be announced this month.

He says advertisers are starting to see the benefits of having consumers interact with their products, and thereby creating a meaningful link between brands and customers.

“[Internet] penetration is growing and the government is trying to make it as easy and cheap as possible to grow the number of users. Advertisers are realizing that this is a mass media and it’s interactive and effective,” says El-Din.

One of Connect Ads’ most popular campaigns was for Axe brand scented antiperspirant for men. The company created an online game in which users vied for girls’ phone numbers by selecting from a list of pickup lines.

The game reiterates key messages of the brand — attraction of the opposite sex, coolness and youth — in a fun way that consumers won’t see as an overt attempt to get their attention.

The Content Conundrum

The country’s online advertising industry, though, has some hurdles to overcome. Only 1% of all content online is in Arabic and out of that, only half is considered Egyptian, says Hussein Freijeh, Middle East advertising director of Yahoo.

If online advertisers want clout with companies, they need to find a way to promote investment in local websites and online services.

“It is frustrating, there is no investment in terms of localizing and customizing [internet] content for consumers here and giving people more services to browse the internet,” Freijeh says.

According to Yahoo, which recently bought Jordan-based Maktoob, one of the most popular Arabic websites in the region, there are 50 million people online in the Middle East. But only a negligible amount of the estimated $5.5 billion (LE 30 billion) spent on advertising in the region winds up online.

Freijeh says internet advertising can’t grow unless there is enough content to support it, which will take a cooperative effort from companies, governments, NGOs, educators and advertisers.

“We have to start thinking as media owners and investment owners. What can we do to take content and target it for our consumers? Do we really have the means and the platform to create [sophisticated online ad campaigns] here?

“My answer is no because we don’t have the kind of investment, collaboration [which is necessary] and marketers aren’t making an effort to give this medium a chance,” he told the crowd.

Skype, the fast-growing global internet phone service, knows its growth is directly linked to how accessible new users find their website. That’s why the company recently launched an Arabic version of its portal along with downloadable free software.

“Before launching, we did get a lot of feedback from users that wanted to know if they could find this info in Arabic,” says Rouzbeh Pasha, Skype’s head of marketing for the Middle East and Africa.

Internet giant Google has also made inroads in providing localized content with its free Chrome internet browser, which came online in 2008.

Arabic web surfing added to the popularity of its search engine and drove growth in 2009, says Wael Fakharany, Google Egypt country manager.

“We visited 229 clients [in 2009]. Some of them took online advertising slightly, some of them experimented and then stopped and some of them jumped on the bandwagon,” he says.

He believes it’s just a matter of time before more companies finally make the jump to digital marketing. “In 2010, we’re not just going to double our business, we’re going to triple and quadruple our business.”

What are you looking at?

In an effort to reach consumers amid the chaos of the internet, online advertisers are always on the prowl for the hottest websites and headline-grabbing issues.

Most Popular Sites in Egypt (from tracking agency Alexa.com)

  1. Google.com.eg
  2. Facebook.com
  3. Yahoo.com
  4. YouTube.com
  5. Google.com
  6. Windows Live.com
  7. Myegy.com
  8. RapidShare.com
  9. Maktoob.com
  10. Blogger.com

Most Popular Searches on Google

  1. Swine flu
  2. Star Academy 6
  3. Telecom Egypt bills
  4. Mahatet Masr radio
  5. Mazika4ever
  6. Youtube
  7. Ministry of Education
  8. Zodiac
  9. Zamalek Sporting Club website
  10. Al-Shorouk newspaper
  11. Travian.ae
  12. Masrawy.com
  13. Yallakora.com
  14. MSN.com
  15. MediaFire.com
  16. FilGoal.com
  17. 4shared.com
  18. Microsoft.com
  19. Mazika2day.com
  20. Wikipedia.org bt

Source: Business Today Egypt