With the web only securing one per cent of media dollars - even for an integrated advertising campaign - it may seem that the prospects for internet marketing have changed little over the last three years.
But look beyond the tight budgets and there are signs of a cautious recovery.
The inflated claims about the power of web advertising are a thing of the past. Instead, companies seeking more diverse and subtle ways to grab audiences through interactive media or ads targeted at individual users are triggering a nascent recovery in online marketing.
In recent months, the region's online scene has seen major campaigns launched by advertisers such as Unilever, Coca-Cola, Nike, Audi, British Airways, Samsung and Palm - high profile brands that have integrated several elements such as TV, print, direct mail and events, as well as online, into the marketing mix.
The online rush has partly been fuelled by formats that take print or television ads a step further. According to MSN's regional director for sales (business division) Robin Fern, the rise of broadband access - particularly in markets like Hong Kong where Nielsen//NetRatings reports 80 per cent have broadband hookup - is allowing brands to run campaigns that integrate video and sound. "More mature web advertisers such as Nescafe are using Unicast (technology) to feature full-screen web ads that run like TV spots.
These are marketers who really understand the online channel."
Portals are also developing larger ad unit sizes (such as hockey sticks and half-page units), streaming media and rich media (which draws 28 per cent of online ad placement in the US) to lure traditional advertisers, while others are offering search engine marketing.
Kevin Huang, CEO of Pixel Media, says search engine marketing is the tactical placement of ads on search engines like Google. "Although it has been around for seven years, it is only recently that advertisers are taking advantage of this platform and seeing the benefits of it... It's extremely relevant, as ads are placed based on specific topics that are searched for by users."
Yahoo's head of sales for Hong Kong and South China, Ivy Wong, says that, in Asia, most advertisers are still running web campaigns for the direct response capabilities that online provides, but she adds that, "online can be used for brand building or it can just focus on one sales promotion".
Wong (and much of the online industry) agrees that online marketing can be highly effective when it's integrated into an overall marketing mix.
"The web is a good medium to deliver information. Take bakery company Garden, which had a campaign launch around Mother's Day for its hi-calcium bread. It had only used TV in the past. It now wanted to educate consumers on the benefits of the new product and that wasn't possible through store promotions. Of course, they also needed direct response and sales results.
We took this as an opportunity to build the brand online."
Yahoo created a site featuring the brand's TVC for hi-calcium bread.
It also presented detailed information on the product and a game targeted at children, with the hope that both mums and kids would have an incentive to go to the site. The three-week campaign reported an initial 40 per cent increase in sales, which stabilised at 20 per cent after the campaign period.
Marketers are also using interactive tools to build brand awareness, creating a broader experience on the web. Venus Lee, director at emarketing company eCrusade, says brands like San Miguel are using sites to extend offline branding campaigns.
"San Miguel and Qoo are good examples with the former using the site (sanmiguel.com.hk) as a natural elaboration of the thematic advertising featuring (Hong Kong actor) Stephen Chow and his buddies, with a series of mini-bar online games that re-produce the 'Refresh' experience online.
Qoo is also using the web to feature 26 TV clips online every week. These will be integrated with the TV and radio ads in early September and will run with a contest that requires users to go to the site."
Other marketers are using the web to 'test' commercials before they air on TV. In the US, Pepsi put various versions of its Superbowl TVC featuring pop star Britney Spears online, asking web users to vote for their favourite version of the ad. Wong says: "This is a good testing ground for Pepsi because Superbowl ads cost millions of dollars. They got wide coverage before the Superbowl and had people interacting with the brand as they voted online."
A host of new tools that allow for the sort of audience segmentation and demographic that drives offline brand awareness advertising have popped up in Asia through companies like DoubleClick and Nielsen//NetRatings.
These tools have the ability to gather relevant information about an audience, taking some of the guesswork out of online media buying and planning.
They enable agencies to create detailed, compelling cases to get traditional brands to spend online, and allow marketers to see the profile of whom they are reaching as well as what they are doing as a result of being exposed to a specific campaign.
So why aren't agencies and advertisers using them?
Take British Airways, which has been using the web for about four years in Asia. The airline runs tactical campaigns with online element three times a year. It also emails its subscriber base as part of the online package. Yet, according to BA's relationship marketing manager for East Asia, Choi Fong, reporting and measurement for online campaigns doesn't go beyond click-through rates.
Asia Digital Marketing Association chairman David Ketchum says the monitoring of how people respond to specific digital marketing initiatives is near maturity. "The potential for more sophisticated research tools such as panel-based ratings and tracking is here in Asia now, and the benefits to advertisers of being able to understand their audience's lifestyle, spending habits and cultural preferences will be an important part of advertisers' confidence in investing a greater proportion of their media dollars online."
He adds that the 'chicken-and-egg' fact means research companies are "unable to justify the expense of providing this level of data if the online ad expenditure isn't there yet to justify building the services".
Web Guru chief guru for sales and marketing Napoleon Biggs adds that the ability to track performance is an advantage to online advertising, allowing marketers to change media placements in real time. Using email as an example, he says marketers can track how many people emails are sent to, which ones receive them successfully, who opens them and what specific information they click on.
"We had one campaign where we weren't getting the response we wanted so we slightly reworded the tag line and saw instant results. That's the key with online - tracking can play an important role to ensure campaigns are relevant, timely and personalised."