Who will dominate the new digital age?
The latest Entertainment and Media Outlook report released by PWC predicts rapid growth for the sector between 2014 and 2018, stating that “combined revenues from Internet access and Internet advertising will account for an estimated R71.6 bn in 2018, accounting for 37.6% of total revenues (of R190.4 bn).”
The report has significant implications for advertisers – according to the analysts, digital magazine advertising will grow at 52,6% CAGR compared to a below-inflation rate of 2.1% ofr print advertising, and digital advertising in general will climb by 26.6%. Online television advertising will also grow by 52.6%, reflective of the preferences of a new, digitally savvy and Internet-enabled consumer base.
The report follows shortly on the heels of the release of Effective Measure’s Internet Traffic report, which revealed that Gumtree and News24 are drawing massive audiences, drawing traffic of close to 8 million and 4.5 million respectively every month.
Johan Nel, Country Manager for Gumtree, says that the report is indicative of an exciting upswing in tech adoption and that digital companies should be encouraged by the shift. “I think the case for online trade has been made,” he states. “The numbers are there, and soon those numbers will skyrocket. We shouldn’t look at what these reports say about a medium, but rather at what it says about the maturity of the market and the consumer psychology. If you haven’t positioned yourself as a digital leader, you may have already lost the race.”
Vicki Myburgh of PwC has also stated that “technology is increasingly being driven by consumers’ needs and expectations”, making special mention of the market’s preference for mobile technology (such as “smartphones and tablets”).
“Mobile is a key strategic focus for us,” says Nel. “The accolade of being the most frequently trafficked local site is a significant one, but it doesn’t afford us the luxury of complacency. Consumers are increasingly mobile, and we need to evolve with them.”
Nel says the uptake in digital advertising bodes well for the significant classifieds industry in South Africa. “Although digital news and television are popular with advertisers, and will increase even further in the years to come, these platforms do not have the advantage of drawing traffic with buyer intent. We know that consumers with digital access are also consumers that both buy and sell – China, the United States, Australia, Canada…virtually every country in the world has at least one classified site ranking among their top ten most visited sites. Year on year growth has been significant for us, and we expect to grow even more as the market grows.”