Tag Archives: Japan

The State of Programmatic Advertising in Japan

Jason Fairchild
Jason Fairchild, Co-founder, OpenX

Digital in Asia asked Jason Fairchild, Co-Founder of OpenX, one of the largest global sell-side platforms, to tell us about the state of programmatic advertising in Japan.

Digital in Asia: How is the Japanese market approaching programmatic advertising? Is Japan ahead, behind, or just different compared to other global programmatic markets?

Jason Fairchild: Programmatic is taking off in Japan, however, the market is still in its nascent stages, and spend is lower than other markets, such as the US and China. Despite this, more marketers than ever are using the technology to boost reach, relevance and impact, and a recent study from PwC predicts that the increasing demand for programmatic technology is set to push Japan’s media market to US$170 billion by 2020.

It’s not surprising that programmatic is growing as the technology streamlines the buying and selling of online ad space, allowing publishers to efficiently monetize their online content and brands to execute audience-based buying at scale – that is, putting the right message in front of the right user at the right time at massive scale. With investment in online ads expected to increase by more than US$3 billion, marketers will benefit from leveraging this technology to make their advertising more efficient.

DIA: How is OpenX addressing the issue of quality in digital advertising?

JF: As programmatic grows in Japan, it’s important to ensure the advertising ecosystem remains a clean and safe place in which to do business. In 2018 alone, OpenX is investing US$25 million in different quality-assurance measures, and we’re making sure we comply with industry recognised quality standards and have received independent certification for our efforts.

It’s important to note, however, that there are steps that everybody can take to take to stamp out bad practices and tackle fraud. Technology companies, marketers, publishers and every other part of the supply chain all play a role in solving for the quality issues across the industry.

With the recent emergence of new industry standards and initiatives, marketers are now at a point where they can make informed decisions about their technology partners, based on the partners’ commitment to quality.

One example is the IAB’s ads.txt initiative, which has nearly stamped out the threat of domain spoofing, also known as misrepresented domains, and dramatically increased clarity in the supply chain by public record of who is authorized to sell a publisher’s inventory. Another is third-party certification with Trustworthy Accountability Group (TAG), a cross-industry accountability program to create transparency in the business relationships and transactions in digital advertising. Technology companies who meet the stringent standards for certification outlined by TAG earn a seal of approval, and because these demonstrate good practice among vendors, these standards can help buyers and sellers make better decisions on technology partnerships. But it’s important to note that these quality controls are not automatic – they require proactive choice by buyers.

DIA: Mobile now accounts for half of all digital ad spend in Japan. What does this mean for advertisers?

JF: More Japanese consumers own smartphones than ever before, so it’s not surprising to see users spend more time on mobile devices, which in turn drives a marked shift in content consumption towards mobile. Advertisers and publishers have picked up on this trend and now understand that mobile has become the place where consumers spend a majority of their time, and they must adjust their digital strategies accordingly.

To effectively take advantage of this growing channel, advertisers will need to incorporate a range of mobile-specific ad formats and move aggressively away from the desktop-first mentality that most of them have been using. This includes building creative that considers the smaller screen sizes and leveraging rich location data to add more context to their campaigns. On the other hand, publishers must also think about screen size and the user experience to ensure that users aren’t bombarded with too many ads or ones that impede a users’ ability to see or read the content they want.

DIA: Speaking about mobile, what is the future of in-app advertising in Japan and globally?

JF: Quite simply, in-app advertising is the future of mobile advertising. Japanese adults spend three hours and three minutes every day consuming digital media, and in 2017, mobile accounted for more than half of all time spent on digital, so the opportunity is huge.

Studies reveal that the most lucrative in-app ad opportunity is a new innovation called opt-in video, where the consumer is given something of value in exchange for engaging with a video ad. This type of video advertising has proven to be the most consumer-friendly ad format in mobile, and in fact, consumers like it three times more than a non-skippable pre-roll. Completion, viewability and engagement rates are significantly better with opt-in video than other types of mobile video, and the consumer-friendly nature of the ad format makes it a great option for publishers and app developers trying to monetize their content as well.

DIA: What are OpenX’s plans for the wider Asia Pacific region?

JF: Both our Japan and APAC business are continuing to grow. In fact, early this year we announced record new revenue growth in Japan of 52% year-on-year and have signed more than 40 new clients in 2018 alone. The growth derives from us being the largest independent advertising exchange in the country (second only to Google) at a time when programmatic is gaining traction in Japan.

As a result, last quarter we announced that we will be opening our Singapore hub, and plan to move into Australia by the end of Q1 2019. To complement our expansion, we’re committed to growing our team in the Asia Pacific region. We appointed Satoru Yauchi as the director of partner services in the region, who has already played a key leadership role on the team since joining late 2017 and will continue to support us in delivering on our ambitious plans for growth across the region.

Half of APAC Smartphone Users Now Shopping on their Device

The latest MasterCard Mobile Shopping Survey covering Asia Pacific finds consumers embracing the convenience of mobile shopping. Almost half of consumers – around 45% in total – made a purchase using their smartphone in the three months preceding the survey.

Exactly 50% of respondents across Asia Pacific cited convenience as the most compelling reason for shopping on their smartphone. Other motivating factors include the ability to shop on the go and the growing availability of apps that make it easy to shop online.

Fig 1: % consumers who have made a purchase using a smartphone
2014 2013 2012
Asia Pacific 46% 39% 35%
Korea 54% 48% 40%
China 70% 59% 54%
Thailand 59% 51% 51%
Hong Kong 38% 40% 41%
Taiwan 62% 45% 28%
Singapore 37% 31% 40%
Vietnam 45% 35% 34%
Indonesia 55% 47% 55%
India 63% 47% 30%
Malaysia 46% 32% 25%
Philippines 34% 33% 21%
Japan 26% 23% 26%
New Zealand 21% 15% 18%
Australia 20% 25% 19%

In addition to using their mobile phones to make purchases, shoppers in the region are also using it to compare prices between physical and online stores. Close to half (45%) of respondents have conducted price comparisons, with a similar proportion (44%) also stating that they have conducted research online prior to making a purchase in-store.

Overall, consumers from China (70%), India (63%) and Taiwan (62%) are the most likely to shop using their smartphones with the most popular mobile shopping purchases amongst Asia Pacific shoppers include clothing and accessories (27%), followed by apps (21%) and daily deal coupons (19%).

Asia Pacific consumers are also adopting new mobile technologies, with 28% of respondents saying that they use mobile banking apps. Group buying apps (40%) and digital wallets (28%) are the most popular amongst Chinese consumers.

Increased smartphone ownership is clearly having a massive impact on the way people across Asia Pacific shop and spend. Brands and online shopping portals need to continue to develop easy and simple ways to browse and pay, as convenience remains paramount to consumers whether they are shopping on their phones or in-store.

APAC, the $6bn Mobile gaming opportunity

With close to $6 billion revenue, Asia Pacific is the largest mobile gaming market in the world. Led by Japan, China and South Korea, the category is still growing at 25% annually across the region.

We chat to Jun Lim, Senior Business Development Manager and Lison Chen, Senior Account Manager at AppLift about this promising yet “very fragmented” market opportunity.

DIA: What are the biggest challenges for mobile game advertising in Asia?

JL & LC: The Asian market is very fragmented. Each market is different in terms of language, culture, and economic levels. Advertisers in different markets have different levels of understanding regarding the business model and traffic sources of mobile advertising, and traffic is still centralized by either big international players such as Facebook, Google, and Inmobi or local players such as Wechat in China, KakaoTalk in Korea, and Line in Japan. It is important to understand the situation and preferences in each country, and have a localized strategy to better satisfy the advertisers’ needs and wants.

What are the key opportunities?

The Asian market is still growing. Due to the rise of smartphone penetration and shipments, especially in Thailand, Vietnam, and Malaysia, we continue to see rapidly growing markets in South East Asia. Mid-mature markets such as Korea, Japan, and China are the top countries in terms of revenue in Google Play and App Stores. Mobile marketing trend is changing rapidly into performance-driven, meaning that it is possible to do campaign with measurable numbers.

How is AppLift positioning itself in the region? Which markets have the strongest potential?

AppLift positions itself as a data-driven app marketing platform that helps advertisers to handle the full spectrum of user acquisition. Additionally, AppLift highlights its LTV optimization technology that enables quality user acquisition on a performance basis. For example, in Korea, AppLift ran a non-incentive marketing campaign for RealFarm, a mobile farming game from NeoGames that delivered real vegetables to a few users who reached a certain level. AppLift focused on this interesting aspect of the game, and few months after the campaign, the fact that the game delivers real veggies went on viral through AppLift’s various media partners, resulting in a ROI of 1200%. It was a result of both NeoGames’ well-developed game contents and AppLift’s marketing strategy.

Do you see clients using mobile for brand driven campaigns? How do you position the connection between mobile and other media?

Branding can definitely help to increase the performances of mobile game advertising. Supercell, for example, spent millions of dollars on branded advertising for its game Clash of Clans across multiple channels such as metro, OOH and TV in Korea. Supercell’s massive promotion earned the game the number 1 position in the gross chart on Korea’s Google play even without using [the mobile platform] KakaoTalk. After the success of CoC, it has become quite a norm in Korea to do a huge scale branding / offline campaigns as in the case of mobile games such as Summoners War and Line Rangers. Mobile is such an real time channel in this sense, and brands are really getting to grips with the connection to other media.

Mobile ads have a reputation for low – or at least hard to track – performance. How does AppLift overcome this? Is data a big part of your positioning?

Based on big data, AppLift’s programmatic buying algorithm can target only the relevant audiences and content for a certain game. It can optimize campaigns and target performance improvements against CTR or revenue. These data driven techniques are very standard to advertising globally, and it is great to bring them at scale to APAC markets.

What is AppLift’s strategy to take on the APAC market?

With advanced technologies and know-how in each Asian market, AppLift plans to provide one-stop advertising/user acquisition services to advertisers. Our goal is to help advertisers connect their games/apps to the targeted Asian markets effectively through our technology, data and services.

What is your advice for brand marketers in one sentence?

Asian markets are sexy but challenging. Brand marketers should prepare various advertising strategies to adapt to local markets.

Thank you.

MicroAd leads funding round for Ambient Digital in South East Asia

MicroAd Singapore today announced a Series A investment in Ambient Digital Group aiming to expand market share across South East Asia.

MicroAd will also connect its programmatic ad platform to Ambient Digital’s vast regional supply of inventory – a big win for programmatic ad buyers in South East Asia. Continue reading MicroAd leads funding round for Ambient Digital in South East Asia

MicroAd CEO Discusses Strategy and The Future of Programmatic in APAC

MicroAd’s recently launched supply side platform, MicroAd COMPASS, aims to provide a groundbreaking solution for APAC publishers . Kentaro Watanabe, MicroAd CEO, reveals that their new SSP will support increasing demands in the growing RTB market and optimize publisher revenue. See his full interview with Digital in Asia below. Continue reading MicroAd CEO Discusses Strategy and The Future of Programmatic in APAC

Ecommerce in Emerging Asia

Ecommerce is very much in the news at the moment, with Rocket Internet launching their month long online promotion across Lazada, Zalora and Foodpanda, ebay launching in Indonesia, and mobile ecommerce projected to hit $2.4bn revenue in Singapore by 2015. Continue reading Ecommerce in Emerging Asia

Asia’s Digital Future in Focus

The comScore Digital Future in Focus reports provide some of the most comprehensive coverage of Asia’s Digital landscape. Industry leading research across a series of Asian markets, with insight into search, social, online advertising, mobile and e-commerce. Continue reading Asia’s Digital Future in Focus

Mobile Consumer Insights and Research for Asia

It is not easy to find Mobile research, consumer insights and stats for Asia. However, there are two sources that stand out in terms of their comprehensive coverage of Mobile for the region, including local markets. Continue reading Mobile Consumer Insights and Research for Asia

Digital Benchmarking and Measurement

“How much should we be paying per like on Facebook?” or “What is a good CTR for a display campaign?” are questions that will be familiar to anyone working in Digital. Benchmarks are a constant topic of discussion, and it’s only natural that we want to understand whether we are doing better or worse than everyone else.

It is not easy to find Asia specific benchmarks, but this post is a fairly comprehensive list of all the resources available. Where there are no local benchmarks, more general industry specific or global benchmarks can still help us understand performance, so we have included the best of these. Continue reading Digital Benchmarking and Measurement

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  • Educate – Asia’s digital landscape is evolving quickly, but there is a a lack of knowledge sharing, both across markets, and in terms of introducing global learnings. We want this site to be the “go to” location for the Digital resources you need, whatever your role in the Digital ecosystem.
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