The Future is Digital

Social Media Re-Shapes the Saudi Advertizing Industry
The vast majority in Saudi Arabia have left the traditional advertising platforms such print media, TV channels, brochures and flyers, and turned to social media to communicate with their audiences. (Photo by Will Francis on Unsplash)

“I have not designed a press ad for any of our agency’s clients in the past five years. The design team rarely works on print ads. Clients are going digital. This means they prefer social media to advertise their products and services,” said Majid Ali, a local Saudi advertising agency senior designer, when answering a question by Majalla on the effects of social media on the Saudi advertising industry.

The vast majority in Saudi Arabia has left the traditional advertising platforms such as print media, TV channels, brochures, and flyers, and turned to social media to communicate with their audiences.

Social media is the name of the game in the Saudi advertising market. Let’s discover how social media has transformed the local advertising scene.

EASY REACH AND INTERACTION

Out of the total population of Saudi Arabia, which is estimated at 35 million people, the number of social media users is around 28 million. This has made it easier for advertisers to reach their target audiences. This easy reach is not restricted to big or medium companies – small restaurants or coffee shops with one or two branches can open their accounts on social media, post their content, promote their products, and speak directly with their audience, whether they are followers or potential customers.

“YouTube ads, social media content calendars, and online advertising campaigns have replaced TV screens and print media. Radios and outdoor advertising (billboards, unipoles, POS displays, etc.) have survived the transformation," said Husam Rajab, an advertising expert.

“Nobody could tell the exact number of views of the ads that used to be shown on TVs. With social media, every view, click, and impression is calculated accurately without guessing,” he added.

Social media has influencers, who are widely used by companies to advertise products and services in exchange for money. The more followers the influencer has, the higher they charge. The Saudi Commission for Audiovisual Content has recently started to supervise the promotional content posted by influencers to make sure they don’t deceive the public with fake information on products, services, or shops. Penalties are imposed on violators and announced publicly.

CONROLLABLE COST AND INCREASING SPENDING

The total digital ad spending is estimated between USD 878 m-USD 933 m in 2020. The spending on social media ads ranges between 25%-30%. The numbers are expected to increase by 10%-12% according to different sources.

The production of advertising content is carried out by advertising companies, both local and international, as well as by freelancers. In the past, producing a single video ad used to cost tens or hundreds of thousands of dollars. The cost of airing the videos on TVs is calculated by the second, and in print media by the number of insertions. Only big companies were able to afford the high cost.

“Now things are totally different. Advertizing content development can start from a few hundred dollars to millions. Any small shop can produce its advertising content and post it on social media without having to spend a fortune. The content can be promoted by targeting certain areas and age groups with just a few dollars. Big companies deal with media buying agencies to promote their content,” commented Husam Rajab when asked about the cost of producing digital advertising content.

“When it comes to videos, big companies prefer to deal with famous production houses for higher quality. However, there is a growing number of small production houses or freelance directors who can produce video ads for social media at lower costs. There are video ads that are designed to be aired on social media channels, not TVs,” he added.

MAJOR PLATFORMS

The most visited social media platform in the Kingdom is YouTube with more than 20 million users and 55 minutes of watching daily. Saudi advertisers do not only post their ads on YouTube, they also sponsor popular YouTube shows to increase brand visibility and exposure. More and more Saudis prefer to watch local content on YouTube. This is an opportunity for Saudi brands to be present where they can reach their audiences.

In 2020, Twitter had around 13 million users in Saudi Arabia. Twitter is preferred by Saudi adults as a source of news updates and a discussion platform. There are Saudi Twitter influencers with millions of followers, who are targeted by advertisers to promote their brands. The same happens with Snapchat influencers, who are invited to shop or restaurant openings to attract their audience’s attention.

Facebook and Instagram are preferred by expats more than Saudis. Expats form around 30% of the total population in the Kingdom.

“Two-thirds of the ad spending in the Kingdom comes from the services, retail, and FMGC sectors. Due to COVID-19, the travel sector comes last. However, this could change when travel restrictions are lifted. The future of the advertising industry is digital. Social media ads will continue to be the name of the game,” concluded Rajab.

 

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