Online Advertising Market Reaches High Growth in Vietnam

 

“Whilst in its infancy today in Vietnam, the market size increased by 71% compared to 2008”, remarks Lukas Mira, Cimigo’s Online Director. This is the first time that official credible data about the topic is published in Vietnam.

The sector has seen annual growth of 50% thanks to fast growth in the number of local Internet users. The Ministry of Information and Communication said the number of Internet users has now reached nearly 30 million, 35% of the population.

 

Therefore, Vietnam ranks seventh among the countries having the greatest numbers of Internet users last year. The Ministry of Information and Communication forecast that online advertising will continue growing when Vietnam has 40mil Internet users by 2012. Online advertisements are expected to generate total revenue of VND600bil (by USD 31.5 million) in 2012.

 

Despite the increasing importance of the internet, the online advertising market still represents only a small %age of the total advertising spend in Vietnam and is lower in Vietnam compared to other countries in South-East Asia. “Only just 50 cents per year is spent for online advertising per internet user. China spends 15 times that amount”, comments Brian Pelz, Co-founder of Vinagame and member of IAB steering committee in Vietnam.

 

The internet plays a significant role in Vietnamese lives both personally and in business, and it becomes an increasingly important channel for advertisers to reach their target audience. “More than half of the urban population in Vietnam is online, and users spend more than two hours on the internet every day. Despite a rapid growth of internet users, advertisers are still skeptical to use the internet to reach their target audience”, says Lukas Mira.

There is a variety of data sources available about the size and composition of the Vietnamese online advertising market. However, most of these figures are just approximate estimates and not collected using a clear and transparent methodology.

 

Cimigo took the initiative and conducted an industry survey among online advertising selling companies in Vietnam. The study measured revenue data from websites, advertising networks, media agencies and other companies involved with online advertising. Since all revenue data is directly compiled from the companies that sell online advertising, this methodology is considered to be the most accurate measurement of online advertising revenues, and it is widely used in other countries such as USA and Australia. The report breaks down the total revenue by industry, advertising format as well as pricing model and sales channel and gives a revenue forecast to 2010.

 

Cimigo is dedicated to supporting Vietnam leverage the internet for the country’s development. “We produced the Cimigo Online Advertising Revenue Report because for the market to develop professionally there needs to be reliable data so all stakeholders can plan appropriately” comments Lukas Mira. “This report will help advertisers, websites, agencies and the online ecosystem quantify where the market is going, so we can plan and invest appropriately”, states Bryan Pelz, Co-founder of Vinagame.