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Google to boost revenue from small-scale business

Friday, 06 June 2014 | Sanny Cicilia

JAKARTA. Google is aiming to attract more small businesses to use AdWords, its online advertisement service, on the back of the growing use of the Internet across the archipelago.

“Small business is a priority for us. […] In the Indonesian market more than 90% are small businesses,” Google’s head of communications and public affairs for Indonesia and Greater Mekong, Amy Kunrojpanya, told reporters on Thursday.

Kunrojpanya said that advertisement accounted for more than 90% of Google’s global revenue and half of it from small-sized business clients.

She said that small businesses in Indonesia, despite its high Internet penetration, were yet to fully take advantage of the potential of online advertising.

“The global trend [is that] when a country sees 30% Internet penetration […] many businesses begin to take advantage of the Internet,” she said, adding that she was upbeat that the next five or 10 years would see a surge in small businesses advertising online.

As of May, 82 million people in Indonesia, or 34% of the population, were connected to the Internet, data from the Communications and Information Ministry shows.

As online shopping becomes more popular, so will online advertising.

Online shopping in Indonesia is forecast to grow by about 40% this year and 53% next year, from 23% in 2013, according to a recent survey by Visa.

Kunrojpanya said, however, a lack of knowledge and information had been a major hurdle for small-sized businesses in realizing the potential of advertising online.

Many small business owners believe advertising online is complicated, so it the message that online or digital advertisement could be simple, easy and quick needed to be disseminated, she said.

“For the last two months, we have educated a number of small business players in several cities including Jakarta, Yogyakarta and Bandung [West Java],” Kunrojpanya said, adding that Google would continue to spread information about AdWords to more small business across the archipelago.

AdWords provides a simple way to advertise online through search engine Google and its advertising network. 

Advertisers define keywords that manage when their advertisements will appear.

Research firm eMarketer has predicted that the domestic digital advertisement market would have a total value of Rp 13.3 trillion (US$1.1 billion) by 2016, a huge surge from Rp 1.6 trillion in 2012.

The firm also revealed that Google topped the global digital advertisement market, with a market share of 33.24%.

Google earned $15.42 billion in revenue in the first quarter this year, a 19 percent increase from $12.95 billion in the same period last year.

From the total revenue, 43 percent was generated in the US, the biggest geographical revenue contributor for the firm, according to Google’s latest financial report. (Khoirul Amin)

Source : The Jakarta Post

Reporter: Sanny Cicilia
Editor: Sanny Cicilia