• Up to 53% of enterprises in Vietnam advertised their websites and mobile applications through social networks
  • 57% of businesses spent less than VND10 million on online advertising in 2020
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Businesses are still spending a lot on advertising on social media and search engines. This trend has yet to change as many Vietnamese companies consider these the main channels to reach customers.

Social networks and search engines are two platforms that businesses consider to be highly effective in online advertising. Vietnamese businesses are spending a great deal on these two channels.

According to the Vietnam E-commerce Association (VECOM), the proportion of businesses using advertising on social networks continued to increase in 2020.

In the past four years, the growth of online advertising through two platforms, social networks and search engines, has surpassed the old forms of advertising. These are the two main methods that businesses consider to be the most effective channels to reach customers. However, ad spend rates on these two platforms have begun to diverge compared to a few years ago.

According to the survey, in 2020, up to 53% of enterprises in Vietnam advertised their websites and mobile applications through social networks. This rate increased by 4% compared to 49% in 2019. This is considered the main platform for many years that businesses prioritize the most.

Ranked second was advertising on search engines. However, the rate of advertising on search engines decreased from 33% in 2019 to 29% in 2020. This year was the first with a decline after many years of steady growth.

Advertising on newspapers and online newspapers inched up compared to 2019, with 14% and 15%, respectively. Meanwhile, advertising on television decreased slightly with 13%. Up to 24% of enterprises participating in the survey said they had not used any form of online advertising.

A highlight of the advertising market in 2020 is that the majority of businesses cut the cost of advertising through online means and mobile applications.

According to VECOM, 57% of businesses said they spent less than VND10 million on online advertising in 2020. The percentage of businesses spending over VND50 million (nearly $2,500) for advertising was only 10%. The main reason was the impact of Covid-19, which forced businesses to cut spending on advertising.

However, the percentage of businesses that highly value online advertising tools through social networks decreased to 41% in 2020, compared to 52% in 2018. Similarly, the effectiveness of online advertising tools through search engines in 2020 also decreased to 31% compared to 40% in 2018. A reason, according to experts, is that these channels are becoming more expensive.

In 2020, Hanoi and HCM City remained the two leading cities in terms of budget spending on online advertising activities. Accordingly, 35% of businesses in HCM City and 33% of businesses in Hanoi spent more than VND50 million on online advertising. The rate for the remaining provinces and cities in Vietnam was very low. This is consistent with the current difference of e-commerce development among localities.

This article was originally published in VNA

Vietnam Insider

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