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‘Africa, Mideast online advertising market to grow 27% annually’

‘Africa, Mideast online advertising market to grow 27% annually’

Online advertising in the Middle East and Africa is forecast to experience a 27% compound annual growth rate (CAGR) from 2013 to 2018.

This is according to an International Data Corporation (IDC) report entitled ‘New Media Market: Internet Advertising Spending in Middle East and Africa in 2013 and 2014-2018’.

The IDC’s forecast attributes the shift to online advertising to increasing internet usage.

Internet World Stats claims that Africa had 240,146,482 internet users in December 2013. This means the continent has an internet penetration rate of 21.3% against the backdrop of its estimated 1,125,721,038 population.

“Continuous developments within the internet advertising market are driving increasing numbers of organisations to leverage low-cost options such as Google Adwords or Facebook Ads to target their customers in a more efficient manner,” the IDC said.

Sony John, programme manager for telecommunications and media at IDC Middle East, Turkey, and Africa, noted, “The innovative new advertising models facilitated by rising internet adoption are enabling organisations with limited advertising budgets to more fully participate in the advertising market.”

“In this sense, the internet has ‘democraticised’ advertising, as it is no longer absolutely necessary for businesses to have huge funds at their disposal in order to hire expensive advertising agencies or marketing firms. And while this has inevitably resulted in some cannibalisation of traditional media advertising, particularly print, the widening participation of smaller organisations in the advertising space has more than made up for it,” said John.

Increasing disposable income are also enabling more people to purchase mobile phones that can connect to the internet.

For example, the World Bank says Africa’s middle class is forecast to grow from 355 million (34% of the continent’s population) in 2010 to 1.1 billion (42%of the population) in 2060.

Also, research firm Frost & Sullivan has predicted that smartphone usage in sub-Saharan Africa is expected to grow 40% each year until 2017.

The IDC notes then that a young population in the Middle East and Africa is fuelling internet growth in the region, as more of these people seek information online and use social media.

Africa has the youngest population in the world, with 200 million people aged between 15 and 24, according to the United Nations (UN).

However, John said that there is a lack of clarity on varying options for internet advertising in the region.

“Bearing this in mind, ad publishers can help drive this growing phenomenon even further by investing more in generating awareness of the different advertising possibilities that are available online, particularly in relation to the flexible pricing and payment options that can be tailored to meet an organisation's specific budget and needs,” John added.

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