How Successful Is Your Online Marketing In A Recession?

May 18, 2009 - PRLog -- Asian is suffering the effects of the global recession as badly as it did back in the late '90s. While China and India still enjoy limited growth, the GDP of other countries in the region dropped by an annualised 15%, so is online media the answer?

In terms of the trade channel, economies in Asia have been affected by steep declines in output. Of late, it has been reported that the global recession has seen some signs of easing but because of Asia's dependence on exports, total trade exposure, primarily to advanced economies, will not see a sustained recovery until America and Europe return to growth.

The collapse in demand from the West has had a dramatic effect on intraregional trade in Asia. According to the IMF: "Between September 2008 and February 2009, merchandise exports fell at an annualised rate of about 70 percent in emerging Asia—about one and a half times more than during the information technology (IT) sector bust in the early 2000s and almost three times more than during the Asian crisis in the late 1990s."

In terms of the financial channel, it was expected that Asia would be insulated from the meltdown as banks and other financial institutions were adequately capitalised and had limited exposure to the subprime securities that brought the house down. It also has scant involvement in high-risk mortgage lending practices. However, as Asia's financial ties with the world have became more entrenched over the past decade, it has exposed the region to deleveraging which has led to international bank flows turning negative.

Here in Thailand, the situation is far from promising. With the closure of the airports last year and the subsequent anti-government protests that cancelled the Asean summit in Pattaya, and now with the flu scare, the government is to invest at least 200 million baht in the private sector to revive the tourism industry alone. Kurt Wachtveitl, departing general manager of the Mandarin Oriental, Bangkok, told the Foreign Correspondents' Club of Thailand: "It's the perfect storm, for Thailand in particular. We have 45 suites, and for the next two to three months, we don't have a booking for a single one of them."

Back in February, Property Report Thailand published "Online for recovery", an article that suggested economic recovery amongst hoteliers could be handled by switching marketing models to the web: "With the Samui market now in the grip of a severe downturn, agents and developers are taking time out to embrace new online tools, readying themselves for what they hope will be a brighter future." But is this true now we are in May, in the off-season, with political agitation now firmly in the minds of travellers and augmented by the onset of swine influenza?

It does makes sense if you take the long-term view, and although we have noticed hotel bookings on our own site in Koh Chang to have come to an almost standstill this month following the post-Pattaya summit debacle and H1N1, with numbers running close to the ground, the woeful state of the Thai tourism industry will not be around forever. So it does not preclude making efforts to continue marketing websites, as when the recovery does start to take effect, those who have participated in online efforts will be rewarded and be far better placed than competitors who are sitting on their hands. It is important to remain (or become) committed to providing quality content and being proactive online just to keep abreast of the competition.

It has to be said, though, search engine marketing is not the business it once was with many sites, especially directories, now off-limits. It is now very difficult for companies to formulate an online strategy that delivers but the key is optimise correctly, get "quality" and "relevant" backlinks and deliver unique and fresh content. The order of the day is now article submissions, forum postings, social bookmarking and blog commenting. Many firms, however, are reluctant to write articles or press releases and would never even consider paying an online journalist to do so. But in procrastinating, they tripping over their own shoelaces.

According to a recent report in The Nation: "The first-quarter [2009] earnings of major listed hotel companies plunged by an average of more 70 per cent year-on-year, with the depressed state of the sector expected to worsen in the current quarter and continue until the high season returns in the final three months of the year." This, they said, is "due mainly to the domestic political uncertainty" in that the Asean summit's postponement has "severely tarnished Thailand's image".

In a related article The Nation stated: "More than 100 hotels and resorts nationwide are being put up for sale, as operators succumb to the impacts of the economic crisis and political unrest." While some have suggested the best way to manage a company's marketing should be a dramatic shift from offline to online models in order to help generate incremental revenues, most have no idea how to achieve this effectively.

The first step in the process is to analyse a website thoroughly; research the keywords used and look at the traffic being generated from them; review placement on Google and Yahoo for each; and then optimise the entire site. This, however, is just the first phase. According to Property Report: "...The smart money is now increasingly being invested into intelligent redesign, search engine optimisation and social media, all of which affect the way potential customers arrive at a site." Quality content is key, alongside successful web optimisation. This is the area where you sink or swim in terms of being found on Google. Online videos, with links from YouTube will also keep the reader interested visually, but the real graft is in the marketing.

There is still a long way to go before the economy gets going again even though The Economist is sanguine about emerging Asia's long-term economic prospects: "Looking ahead, relatively robust expansion in domestic spending should help most Asian economies to keep growing faster than the rest of the world. But the tigers are unlikely to return to their heady growth rates of recent years—nor would that be desirable given the impact on inflation and the environment..."

In Thailand, the political events of the past few months have taken their toll and it is unlikely that reconciliation will come about overnight. It is also the case that although the global recession may be easing, that doesn't mean the region will return to its high-growth figures of 2007. Perhaps the way to react to the economic slowdown is to speed up and look at alternative online media options intelligently and proactively.

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Soho Properties is a leading Bangkok property real estate agent and location specialist, offering a first-class service for all your property-related needs.
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