THE IMPACT OF COVID-19 ON DIGITAL MARKETING INDUSTRY IN UAE
Major events like COVID-19, especially one that has its effects worldwide, have a significant impact on human populations. It transforms lives in more ways than one; and not only for that particular duration while it lasts but acts as a catalyst for significant changes thereafter. This has been true of events that took place since the 20th century – the First World War brought about social changes such as universal suffrage. The Second World War witnessed the setting up of the NHS as well as a strong consensus on a new social and economic model which lasted over 30 years.
The continuously evolving global outbreak has brought about transformational effects on social attitude, lifestyle and our way of work and shopping. And while the Coronavirus crisis has been a huge threat to most businesses which in result affected jobs situation as well as health. But with lockdowns in place, the digital marketing and e-commerce industry has led to an unprecedented disruption.
TRANSFORMATION IN DIGITAL
The UAE had recognized the importance of digitization long before COVID-19 in order to leap forward and has constantly been making efforts to fully utilize the role of Information and Communication Technologies (ICTs). Dubai Internet City which was established back in 2,000 is a complex of purpose-built office buildings with over 1,600 technology companies. Soon after that, UAE launched e-Government and e-Dirham which replaced the traditional way of paying and collecting fees for government services.
Artificial Intelligence (AI) played a major role in dealing with and controlling COVID in UAE. Even major conglomerates such as Dubai Mall shifted their focus to online mediums and adopted e-commerce approach by creating partnerships with e-commerce websites such as Noon, Amazon & Namshi.com. Brands had to revisit their business models in order to overcome the losses and continue making sales. 14% of brands admitted to re-allocating their in-store budgets to online mediums and digital advertising while 22% of brands observed a significant shift in creative & geographic strategies.
Online applications like Zoom and Microsoft Teams were unblocked to enable remote working from home and virtual classes for students. However, the lifting of restrictions has been a temporary measure to help manage the crisis. But despite being a temporary measure, it helped minimize the disruption and losses to businesses and even created opportunities for some to shift the medium of their services to digital platforms, instead of having to shut down or suspend them indefinitely (for e.g. medical practitioners, fitness instructors, artists, independent consultants, etc.
DIGITAL ADVERTISING IN DUBAI
The Coronavirus outbreak has brought about evolution in the digital marketing industry worldwide and therefore created opportunities for the digital advertising industry in Dubai. Provided that the businesses took an immediate action and shifted gears, pronto. The transition to remote work prompted by the lockdown and social distancing measures created the need for digital marketing of brands and virtual customer interactions.
According to statistics, 70% to 75% of the digital advertising goes to Facebook and Google. The rest of the digital advertising budget is divided among Twitter, LinkedIn, Snapchat, Tiktok, and other Ad channels. Moreover, a report by PwC shows that 78% of buyers in the Middle East use social media to get inspiration for their purchases – the number is much higher than the global average of 37%. As a result of which, social media is leading digital advertising for advertisers. Besides that, YouTube has gained a major demand lately as it was able to attract a big chunk of traditional TV Ad spend.
Ad expenditure in the GCC region as a whole is moving towards ‘performance-based’ marketing with a strategic shift into learning budgets and thus, 59% of advertising agencies are significantly shifting into performance-based campaigns. The United Arab Emirates is leading the growth in programmatic advertising due to the technology partners and the need to automate the process and use AI.
In conclusion, the UAE continues to be the top market in the region due to its leading role in digital media with Dubai being the epicenter. Dubai is a major business hub and home to advertising firms as well as the headquarters of multinational companies. Moreover, the financial benefits provided by the banking systems in Dubai allow international firms to manage their advertising budgets from the city.
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