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Google is planning to subsidize mobile-friendly websites of small and medium-sized businesses (SMBs) in Thailand that are willing to sign up for its mobile ad service, according to local media reports.
Google’s offer of a quid pro quo makes a lot of sense given Thailand’s status as a growing mobile-first market. According to eMarketer estimates, there will be 30.0 million smartphone users in the country by the end of this year, representing 43.8% of the population. eMarketer expects that penetration rate to cross the 50% threshold by 2020, when 35.1 million people in Thailand will use smartphones.
Understandably then, digital advertising—Google’s core revenue stream—is shifting toward mobile in the country. eMarketer projects mobile ad spending will account for just 7.3% of all media ad spending in Thailand this year, and 41.8% of total digital ad spending. However, outlays for mobile ads will more than double from $168.5 million in 2017 to $343.0 million by 2020, when it will make up 14.3% of total media ad expenditures.
Fully aware of this, Google now seeks to appeal to SMBs—which, according to the Bangkok Post, account for 40% of Thailand’s GDP—that may lack the technical knowledge or resources to create an online presence. Google reports that just 10% of SMBs in Thailand have company websites and that many of them were designed specifically for desktops, not for mobile devices.
“Having a mobile website will be an essential marketing tool for [SMBs] to increase their presence in the large online community,” Ghislain Chatelier, Google’s regional director for Southeast Asia and Greater China, told the Bangkok Post.
Google is also offering its SMB partners the use of a tool to help determine if its website’s pages are loading quickly and efficiently. The company has been pushing for widespread adoption of its Accelerated Mobile Pages (AMP) open source mobile website standard by prioritizing AMP pages in its search results.
Part of Google’s motivation in getting into Thailand is likely to stave off competition from Facebook, the other half of the global digital advertising duopoly. According to data from the Digital Advertising Association (Thailand), advertisers spent more than THB2.84 billion ($83 million) on Facebook ads in the country last year, vs. roughly THB1.66 billion ($48.6 million) on YouTube ads.
US paid media ad spending will grow steadily in 2017, on the heels of a strong 2016 boosted by the Rio Olympics and the presidential election. A focus on mobile will fuel growth, pushing total media spend to more than $206 billion this year—a moderate increase of 6.1%.
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