Digital marketing in the Middle East and North Africa (MENA) is flourishing, according to an Econsultancy report, which has found that digital budgets are expected to increase by 28% on average.

Econsultancy’s State of Digital in MENA report looks in detail at the levels of spending across different online and traditional marketing channels in the Middle East and North Africa.

The 47-page report is based on a survey of more than 50o B2B marketers in the region, undertaken in partnership with Arabianbusiness.com, and reveals that the digital landscape in the Middle East is exhibiting rapid growth. According to the report, 22% of overall marketing budgets in the region are being invested in online channels, and 58% of companies are increasing their digital budgets in 2011.

Email is particularly strong in the region, with 80% of clientside marketers using this for marketing. Social media is also thriving, as 56% of Middle Eastern companies are currently using third-party social networking websites, such as Facebook and Twitter. However, fewer companies (23%) are investing in on-site social media, such as blogs, forums and ratings and reviews.

The report findings reflect a buoyant digital sector, but the industry is still very much in its infancy. Factors restricting digital growth and preventing some organisations from investing more money in digital marketing include company culture, a reliance on traditional marketing methods and restricted marketing budgets.

Econsultancy’s Research Manager, Aliya Zaidi said: “Digital marketing in the Middle East is at the beginning of the lifecycle. It’s rapidly growing, but the market still faces major barriers, such as lack of understanding and familiarity with digital channels.

“As the industry evolves, more training and education is needed to bridge the gap in client knowledge, and the onus falls on agencies and supply-side companies to provide services to educate their customers. This will allow companies to get more senior management buy-in for increased digital investment.”

Zaidi continued: “Despite these barriers, spend on online marketing in increasing across the board. As more companies increase digital investment, this will help to address the lack of case studies in the region.”

The full results of results of Econsultancy’s State of Digital Marketing survey are being presented at Econsultancy’s Digital Cream Dubai event on 12th April, in a joint keynote with Ahmad Bashour, Digital Publishing Director at ITP and Ashley Friedlein, CEO of Econsultancy.

Key survey findings:

•Investment in digital channels is increasing across the board, particularly for new, emerging channels. Some 53% of companies are planning to increase their budget for mobile marketing, while 51% are increasing their video advertising budgets.

•Investment in search engine marketing is high up on the agenda, with 56% of companies increasing budgets for search engine optimisation, and 49% for paid search.

•Some 28% of companies are planning to increase investment in business analytics and web analytics software. This will enable organisations to effectively understand and measure return on investment.

•According to 28% of companies, reliance on traditional marketing is preventing their company from investing more money in digital marketing, while 47% of agencies said this was a problem for their clients.

•The ability to manage customer relationships will be a key area of growth, as 41% of companies are planning to increase investment in CRM channels.

•Print media dominates traditional marketing, with 69% of companies using newspapers and magazines.