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04.11.08 - Digital Revenue Surges

SYDNEY: Australian businesses plan to invest more than $17.9 billion dollars in digital services in 2009, a survey by the Australian Interactive Media Industry Association (AIMIA), IBM and Hyro has found.

According to the first annual AIMIA Digital Services Index, revenue generated through digital services as a proportion of total revenue jumped by 17% in 2008, and now accounts for almost one in every four dollars earned by the companies surveyed.

The research also demonstrated a shift in the way organisations are interacting with customers. Companies plan to target 40% of customers through digital initiatives in 2009 to take advantage of the increased segmentation, personalisation and availability that digital channels have to offer.

Surprisingly, the Index found that online advertising, traditionally regarded as the mainstay of Australia’s digital services industry, accounted for only one-third of spend on digital marketing.

“The AIMIA Digital Services Index is an important milestone for the digital industry in Australia,” said AIMIA chief executive John Butterworth. “For the first time we have been able to measure the full level of investment being made in Australia to implement digital initiatives.

“Forty percent of customer interaction for business and government is now done via digital channels and these channels deliver 25% of revenue.

"Despite this, the levels of support for the digital industry from government and for the public infrastructure initiatives required to further develop Australia as an international leader in digital appear to be lagging," Butterworth said.

Despite the results, investment in digital services will reach only 14.3% of organisational expenditure for 2009, indicating significant underinvestment in digital services.

The Digital Services Index, a collaboration between AIMIA, IBM and Hyro, defines and measures digital services using the following four categories: media-related content, services and applications; marketing related professional services; technology software and hardware; and infrastructure, hosting and connectivity.

Reference: http://www.adnews.com.au/news.cfm?NewsID=5495&alpha=23958&beta=94900