Online ad growth fuels Pixel profits

Hong Kong - Pixel Media has seen its 2007 operating profits soar over 76%, as online ad spend nears maturity in the Asian markets.

In the year to 31 December 2007, Pixel Media's operating profits increased 76.2% to US$2 million on top of a revenue increase of 67.5% to US$12.9 million, which the online and mobile ad sales company is ahead of GroupM's forecast that online advertising would have grown 26% in 2007.

Compared to 2006, Pixel has expanded its advertiser base by 43%, having won new clients such as the Richemont Group, BMW Mini, Disney China, Singapore Tourism Board and MGM Macao.

Kevin Huang, CEO for Pixel, said the growth in advertisers for the company were due to the addition of more new and first time advertisers, increased frequency and budgets from existing advertisers and expansion into new markets like China and Singapore.

"In general, advertisers are now more receptive to online advertising due to the fact that online is now a mass medium and has very high reach of total population in most Asian markets like China, Hong Kong, Singapore and Malaysia," he said.

Huang observed a new category of clients from luxury brands such as Cartier, Tudor and Piaget that previously did not use online have started to explore this medium.

"This is a sign that online has started to hit maturity", he added.

The company also reported total number of ad campaigns it ran for advertisers increased 22%, with many first time advertisers shifting a substantial amount of ad budgets from other mediums to online.

Huang said from conversations with advertisers, some have indicated they will increase online ad budgets by at least 15 to 30%.

The travel, banking and finance, tech, media, telco, education and consumer electronic are spending greater amounts online but increasingly new categories of clients from luxury brands, auto and FMCGS are also investing more in the online space.