Big Changes for Online Advertising in Vietnam

For Google staff, today should prove to be slightly more relaxing following a week of big announcements. For many of them, the week started with a cup of coffee at the annual I/O developer conference in San Francisco, where Google’s heavy hitters spent dozens of hours announcing new products and improvements. These included a master plan to beat Spotify with Google Play Music, revolutionary updates for Google+ in order to compete with Facebook and Twitter (they were able to convince me) and new features for Google Maps and Gmail. Back in Asia, the Google staff in Saigon had something important to present as well. After a long wait, Google Display Networks service has finally arrived in Vietnam, something many digital marketers have had high on their wish lists.

For those who are not very familiar with Google Adwords, it is the Google platform that allows private business to advertise their products in two different ways:

1. Google Search Network: Companies can pay Google to have their ads show up on specific keywords. These are the orange boxes that show up above search results.

2. Display Network: Companies can display their advertisements on other websites that are part of the massive Google Display Network. As opposed to the Search Network where all the ads are text-only, GDN (Google Display Networks) allow videos and banners with images.

In other words, Google acts like an intermediary, providing the IT infrastructure to let companies place their ads on other sites.

Good News for the Internet Business environment in Vietnam

So why is this launch important? Because it will directly increase the amount of money that big companies spend not only in digital marketing, but on-line activities in general. For the traditional orange advertising boxes of the Google Search Network, Google reaps all the profits. But, with Display Networks, a large piece of the pie will end up in the pockets of local companies with high traffic rates as Google pays an average of 68% of total revenue collected to content publishers.

Vietnamese website owners will have more options to maximize revenue from their online content. For example, FoodPanda.vn, a well-known delivery food website that focuses on expats, could become an interesting place for premium restaurants in HCMC to display advertisements as both businesses target the same market segment. Additionally, these ads would not harm FoodPanda’s brand image as they are related to the same industry.

These new offerings should indirectly provide Vietnam with a more dynamic internet business environment. As more and more companies start seeing they can further monetize their websites, managers should consider investing more in the quality of their content, developing SEO and social media presences and in improving their website’s design. The latter being one of the main problems that Vietnam's internet industry faces, even in the tech industry (a little bit ironic, don’t you think?).

However, marketers and web professionals should not get too excited yet. It will take time to establish an effective local network of companies, which can generate effective click-through rates (CTR) and add real value to the local IT industry.

If any readers have an Adwords Client-account and want more information, you can register for a webinar where Google will introduce their product to local agencies and marketers in Vietnam. This Webinar will be conducted in Vietnamese.