Heading Mobile for MENA, Joubran Abdulkhalek’s role is to build internal capabilities for the mobile revolution coming around the corner. He talks to Maddict about how digital buying is changing and the rise of mobile.
A mild mannered slender man who imbues his words with infectious enthusiasm, Joubran kicked off his career with Starcom almost eight years ago. In 2008, he was part of the digital team managing the GM account. From Dubai, he later moved to Beirut in 2011 to assemble a team and client portfolio from scratch. He was put in charge of the Egypt and Levant markets, giving him an acute understanding of how different markets behave. Now back in Dubai, he’s getting Starcom’s clients and internal teams optimised for mobile.
Is mobile advertising taking off in the region?
It certainly is. And mobile traffic in general has been growing strongly for a while. And the first thing driving it is smartphone penetration. UAE and KSA are the top smartphone players globally in terms of relative penetration. The UAE is around the 73 percent mark and the KSA is about 67 percent. And the more smartphone penetration grows, the more important mobile becomes for advertisements. Smartphones are more accessible –you’ve got handsets starting at USD 80. And data connectivity is also rising.
What does that mean for the desktop?
We’ve seen a trend where mobile is growing and eating into desktop’s market share. Desktop CTR (Click Through Rate) was really high in the region five years ago. Now, fewer than 1 out of 100 people click on an ad, and CTR averages somewhere between 0.2 and 0.5 percent. This trend of users not clicking desktop ads is only going to gather steam.
On the other hand, mobile is on the rise. Mobile is so personal that rich media or even standard banners are still new to the user. Audiences haven’t been desensitised yet.
How is Starcom reacting to this change?
We want to be mobile-centric as a company because we’ve seen the future. Three years ago, the web vs. app content consumption ratio was 90 to 10 percent. Now, it’s almost 50 percent each way. We’re educating clients and internal teams on this change. Each quarter, we analyse trends, and take that intelligence to our clients. We gather information from a lot of partners, including larger ones like Google and Facebook.
Everyone is talking about the mobile explosion, and has been waiting for it the past two or three years. It hasn’t happened yet, but it will. Clients will have to be educated, and building internal capabilities is key. We are constantly engineering internal capabilities at Starcom to help our clients get the most out of mobile in terms of ROI, leads and transparency and strategic engagement.
You say mobile is rising. What specifically is increasing?
Anything that has to with apps is getting bigger. There is a huge difference between apps and mobile websites, in terms of SDK capabilities, but also how audiences consume content. The experience is much better on the app.
The move to mobile has seen advertisers focus their efforts there. Both Google and Facebook, for instance, have directed their ad sales towards pushing mobile revenue. The eyeballs were there, generating billions of impressions. But mobile inventory was being burnt because no one was advertising, and the fill rate just wasn’t there. Now, Facebook is bigger on mobile than desktop.
Is digital and mobile ad spend in the region generally on the up?
Yes, it’s rising. Five years ago, digital spend was probably less than 1 percent of overall budgets. Now it’s about 10 percent percent of the total. Mobile spend is still low but growing. For every dollar spent on digital, 8 to 10 cents are going to mobile, but that’s nothing compared to what mobile can actually do. At some point, mobile growth is going to take off exponentially.
What sort of ad units does Starcom buy from mobile ad network partners?
Budget allocation really depends on client briefs. Mobile ad units include standard banners, video – interstitial and other types, and rich media executions. We split the pie based on client KPIs.
Standard banners are cheaper, so it’s easier to gain reach and awareness Video is more expensive but also more engaging so brands can tell a story. Rich media is all about brand engagement. For instance, we ran a rich media campaign with Maddict for STC. It included gamification, and rich media that integrated with features on the phone. Maddict found a way to build actions like shaking the phone or wiping the screen to interact with rich media environments.
What’s your position on premium content versus blind content in mobile advertising?
Premium content delivers higher CTRs, with better traffic monitoring, transparency and measurement. Tracking is really important to clients.
Of course the CPM (Cost Per Mille) is higher too. But premium content networks can give you optimisation and tweaking that blind content can’t. You can figure out which networks really well, the websites that are generating good results, and you can tweak right down to the individual ad unit.
With blind content, you don’t always know who your audience is. You don’t know exactly where the ad is running. Of course, you get the performance stats and the CTRs. But CTRs alone aren’t enough, because we want to know more about the audience that’s clicking through.
Allocations between premium and blind content are done based on client goals. For our programmatic buying site though, we work only with premium content that is fully transparent.
Having said that, premium inventory needs premium content, and there is a bit of a lag there. Publishers should also invest in excellent content to grow that segment.
Do you think online advertising growth is going to come at the expense of offline?
It’s an interesting debate. I think both of them complement each other. Online will eventually eat from offline budgets but that’s still being played out. Will online budgets come from TV, radio, cinema or print?
If one channel is saturated, increasing reach marginally becomes very expensive. It makes mathematical sense to move some budget to an unsaturated online channel.
Instead of putting that extra USD 100,000 into TV to get an additional 1 percent, you could put that money into digital to gain a 5 percent increase. However, TV is going to continue being key in the region for the foreseeable future, because IP TV hasn’t made inroads here yet.
What media buying patterns are you seeing for mobile?
We are pushing clients towards digital generally and mobile specifically. Mobile can offer better ROI that is more robustly tracked. Tracking is key because it’s important for a client to know how their money is working.
We’re also creating PMPs (Private Marketplaces) with partners at the premium end of the spectrum. These marketplaces are becoming more select. Programmatic buying, which relies on these marketplaces, is also evolving towards becoming choosier. Our PMPs are proliferating, and feeding into our programmatic buying platform, and this is going to be a core strategy for us over the next five years.
However, some premium purchases still require direct interaction. Programmatic buying is most effective for standard ad units. But interstitial video buying, for instance, still needs to happen directly. And that’s where direct sales complement private marketplaces. You can get better CPMs through PMPs but going direct gives you exclusive ad units.
Are regional markets converging in their approach to mobile?
Not at all. Individual brands have different aptitudes to mobile. And in markets like Egypt and the Levant, the entry price point for mobile ads is more cost-effective than in the GCC. That’s because the inventory size is huge. There are a lot of eyeballs on mobile screens. Egypt has some 50 million people online – that’s twice that of KSA. Of course, the purchase power of KSA compared to Egypt is far higher, so ROI is still higher in the GCC.
Finally, what would you suggest mobile advertising networks do to help agencies like yours grow the mobile pie?
I’d say innovate as much as possible. Bring in more premium content. Also focus on Arabic content, which is key. Arabic content in KSA, for instance, is minimal compared to what it could be. It would be brilliant to have content localisations for key markets in Levant and MENA.
Mobile ad networks can also assist agencies through fast turnarounds. The time from receiving a brief to creating a mock-up, getting it approved and serving a campaign should be shrunk as much as possible.
And finally, our mobile ad partners can help us with insights and research. There’s a wealth of data that Maddict, for instance, has through billions of impressions generated over five plus years of running campaigns. If mobile ad networks could compile this data into investigative research on trends and insights for agencies to take to their clients, we could build a far more convincing case for mobile.
Finally, I’d ask mobile advertising networks to innovate compelling new products and channels to ensure users stay engaged. From a delivery point of view, I’d say there’s room for better integration with existing ad buying technologies. And more and more inventory, including premium options, should ideally be made available via programmatic buying platforms.