T was announced last month that Facebook had finally opened an office in Bangkok, with its whereabouts remaining a secret. For a long time, Google had never really been challenged.
That has now changed, and the race to grab a sizeable chunk of the burgeoning digital-ad spends will be hotter than ever.
Despite contributing less than 5 per cent to overall advertising spending nationally, digital is the fastest growing medium, experiencing double-digit growth annually for the past couple of years, and that trend will only continue for years to come. This will be compounded by the penetration of smartphones, expected to see a significant rise as the cost of these devices continues to fall.
But what does this really mean for businesses in Thailand?
There are about 2.7 million small and medium-sized enterprises in the Kingdom, of which 99 per cent are small businesses, all trying to make a name for themselves. Advertising on a large scale used to be beyond the realm of reality for these small players. Therefore,Facebook has been targeting this large segment with the aim of strengthening support for them and helping them target specific demographics, not only to create awareness of their products and services, but also to help achieve quantifiable consumer engagement and direct sales conversion.
Having seen the potential of Thailand's 34 million accounts and rising, Facebook knew this was a market not to be overlooked, as the average Thai user spends 2.35 hours per day on the popular application, posting three times more than the global average.Thais are very social and entrepreneurial at heart and in nature. This kind of behaviour can be witnessed across both virtual and physical platforms when it comes to interaction between customers and providers alike.
Facebook claims that 70 per cent of its Thailand-based users contact businesses via its platform, enabling conversations and transactions between both parties. We have also witnessed the proliferation of temporary markets, creating an equal playing field for independent retailers with big dreams, where they can directly interact with their customers closely.
We are at an age where the democratisation of businesses is at its peak.
This can only get better with full technical support provided first-hand with a local touch where domestic businesses can access the platform's unique and powerful targeting abilities through interest and psychographic profiling.
Furthermore, Instagram has recently been monetised, giving businesses further options to advertise even more directly with consumers and creating greater engagement, because the behaviour with the application is highly participative compared with other media. We have already seen the likes of Lazada and Total Access Communication (DTAC) experimenting with Instagram and we can expect many more to follow.
Instagram claims that it will represent a large proportion of advertising revenues globally by 2017, and we expect that it will have a major impact on the way ads are created here too, as the platform will allow an option of 30 seconds for advertisers to communicate with their users. After its acquisition of Oculus Rift virtual-reality technology last year, Facebook intends to lay out all of its capabilities from sophisticated ad infrastructure combined with virtual reality to induce an immersive brand-to-consumer experience in the near future.
With social interaction at the core of its brand, Facebook strikes a chord with local businesses as it seeks to build trustworthiness and connections with its customers, something traditional advertising had previously failed to do.
The battle for a piece of digital has just begun, so let's wait and see how the future plays out.
Pradon Sirakovit is associate director for strategy and innovation, IPG Mediabrands.