Jenny Chan 陳詠欣
Oct 25, 2017

Do Hong Kong advertisers treat digital as the 'poor cousin'?

New adspend report shows a rise for TV, sparking a rant by one prominent digital mogul.

Do Hong Kong advertisers treat digital as the 'poor cousin'?

Admango's adspend report for Q3 2017, released yesterday, has stirred up a digital-vs-traditional ruckus among veterans in HK adland.

'Major advertisers switched budget back to TV' was the report heading that triggered a heartfelt Facebook rant from Kevin Huang, CEO of Pixels.

"For over a decade, I've said that advertisers in HK always treated digital as the poor cousin," he wrote. "Every time there's an economic downturn or uncertainty, every time their budgets are cut, they gravitate towards digital ads because digital is perceived as cheaper." Case in point, Huang said, his business (Pixels) and the digital industry in Hong Kong grew the fastest during past crises such as the SARS outbreak and the collapse of Lehman Bros.

"Now like clockwork, every time the market bounces back, and budgets are slightly more comfortable, instead of going to the 'poor cousin' who is much more accountable and value-driven, reaching real people who spend most of their time, where do advertisers go?" he asked.

"Linear, dead TV," he said, where viewership is declining, production quality is low, and results are non-accountable. TV GRPs tracking 2000 people supposedly represent Hong Kong's seven-million population, he said, but TV has "no clickthrough rates, no conversion tracking, no time spent/dwell rate, no real unique users. Go figure..."

"Hong Kong advertisers, you can do better than this...." Huang lamented.

Media share for TVCs in the Admango report was 33%, while paid and free paper ads take up 27% in second place. Television saw a significant increase in adspend since the first quarter this year, boosted by newcomers like ViuTV attracting adspend from banking and investment-services brands. Free-to-air TVB Jade accounted for 65% of overall adspend, a consequence of a 11% year-on-year growth.

Time period Y/Y growth in TV adspend
Q1 2017 3%
Q2 2017 8% 
Q3 2017 16% 

However, Jackson Kwok, currently CEO of X Social Group and president of X Horizon Group, pointed out (in reply to Huang's post) that Admango's data is "actually a distorted picture of reality”. Even if it seems like advertisers are reallocating more money back to TV, Admango fails to monitor the majority of digital adspend, especially in paid search, paid social and programmatic advertising, he warned.

To this point, Admango's director of sales and marketing, Jennifer Ma, said the monitoring service will cover video ads on social media and programmatic buying in 2018, and hopefully be able to present a fuller picture.

Still, monitoring paid social ads was deemed “impossible” by Rudi Leung, director of Hungry Digital, who described them as a “big black hole”.

Nick Fawbert, founder of Mutiny Asia, has a sanguine view of the debate. When budgets are tight, it is necessary to cut top-of-funnel activity [like TV] in favour of conversion at the bottom of the funnel, he said in the comments following Huang's post.

"The problem with that is it 'starves' the pipeline," he wrote. "It stops sourcing new customers. So when budgets are bigger, then top-of-funnel activity must be restored. This isn't stupidity, or laziness, it's good strategy. The digital industry is betraying its naivety if it thinks it can be all things to all people."

One major advertiser that held a similar view was P&G that switched advertising budgets back to TV, echoing comments by its chief brand officer Marc Pritchard to not rule out TV in the global adspend "horse race".

"TV has had a good run in the last year because it’s demonstrated that it gets broad reach and high engagement, the quality of the content has become significantly better and it’s very efficient and effective," Pritchard told Campaign UK.

Evidently, P&G Hong Kong hiked its Q3 adspend in TV by 23%, while dropping desktop and mobile ads by 77% and 41% respectively. Olay, the biggest-spending sub-brand under P&G, allocated nine-tenths of its spending to TVCs for its Total Effects Feather Weight Moisturizer with Sunscreen and Regenerist Micro-Sculpting Super Cream, for example.

TVCs were also the key focus in Cigna’s campaigns in Hong Kong, with the Admango report highlighting its adspend more than doubling when compared with the previous year. The insurance brand’s director of digital marketing for APAC Rose Luk explains her personal take on the role of TV (also chiming in on Huang’s public post). TV “definitely contributes to final digital results” in terms of driving down costs-per-lead (CPL) and increasing overall conversions, she remarked.

“I think we as digital people really have to jump one step out from the digital-vs-non-digital debate to see the big picture," she said. "To customers, there is no line between the two... To us, we want to drive digital adspend. But does it mean we can only drive digital through digital? That is not always true. The integration of mediums helps to drive digital acquisition numbers.”

Cigna measures its numbers by observing search volume, click-through rates (CTR), costs-per-acquisition (CPA) during the same period of time when TVCs are aired, and benchmark those with ‘no-TVC’ periods, she shared.

Admittedly, Huang pointed out that tech vendors like Pixels have a hand in making digital advertising too complex and too technical for some marketers' appetites.

"We need to learn from TV on how to simplify, humanise and make it easy for marketers to spend their money," he reflected. TV can get brand awareness and recall metrics up immediately, and having that awareness / recall will drive consumers to the most convenient channel to buy when it's time to do so, he said.




Campaign China

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