Total Pageviews

Saturday, May 19, 2012

SOME THOUGHTS ON THE BUSINESS OF ADVERTISING IN NIGERIA

       Last year, because of the general election in Nigeria, the amount of advertising coming from the public sector and by extension the political sphere increased considerably as is usual with any election year. Though, the volume of adverts from last year electioneering activities is bigger than any other election period before. But that can be explained by the dynamics that came to define the election as the most expensive ever. Though, the private sector has contributed a lot in financing these advertising campaigns, especially that of the governments in power, these kinds of adverts can be said to have less connection with the macroeconomic movements in the economy of Nigeria. Billions of Naira worth of advertising were carried by major Dailies, most of them coming from the presidential campaign office of President Good Luck Jonathan the candidate of the PDP. Thus, the determinant of who get what is not based only on newspapers circulation but how sympathetic that paper is to the political cause of the ruling PDP. And whether it is election year or not, the federal government and its parastatals remain the single biggest advertiser in the country churning out billions of Naira for adverts that range from tender notice, advertorial, rejoinder, public notice to mention just a few. The existing politics of advertisement require that a paper become answerable to the federal or states governments in order to get adverts on which its livelihood depends. That explains why nearly all the major papers in the country are, simply, a mouth piece of the federal government with the exception of very few hard-line papers. Early this year, many papers got billions of Naira for carrying adverts that support federal government subsidy removal policy, while papers that were perceived to be hostile to the ruling PDP government were denied the share of that advertising budget. Advertising such as that from the Federal Government that are not distributed on competitive market based parameters tend to discourage creativity in the industry and encourage sycophancy and with it decay in the sector.


  Other major sources of adverts in Nigeria outside the government and corporate sectors are congratulatory messages and obituaries; these are what some professionals terms elite advert, very common with the newspapers based in Lagos. The Nigerian elites are very desirable of placing advert in the major papers in the country for the purpose of congratulating each other which is seen as symbol of power and influence among the wealthy elite. Obituary of deceased rich people or their relatives is another very important part of this advertisement market. Billions of Naira are being spent annually on this type of advertisement. This segment of the advert market has some kind of relationship with the performance of the economy and the amount of money the elite make from the government revenues. For example, major politicians and public sector workers put hundred millions of Naira adverts to congratulate major political office holders in the country, in order to get favors from them. Last year during the awards of national honor by the federal government in Abuja, almost a billion Naira worth of advert was placed by individuals and corporations in the country, congratulating the awardees. All major dailies in the country laughed to the banks that day. Elite advert as it is called by some is not the type of advert that encourages creativity in the industry to me, as most of the adverts placed are base on recycle format and design. And to make matters worst, most of those that placed those adverts know little about advertisement to push for highly creative works like is found in the corporate sector. It is believed that the recession Nigerian economy entered in the 1980s was responsible for the newspapers in the country going into promoting the culture of elite advertisement that today provided the sector with billions of Naira in adverts. Obituaries and congratulatory messages have remained a very important source of revenue for the newspaper industry in the country that is only rival by the public and corporate advert.



    The corporate advertising world of Nigeria is concentrated in Lagos, the major hub of economic activities in the country. Lagos alone account for some 55-60% of all types of advertising in the country, making it the dominant location for sourcing and processing of advert. That explains why all the major advert agencies in the country are located there, as well as major newspapers and TV stations. According to some estimates, the total advert revenue in Nigeria increased more than four folds from 2001 to 2010, to about 98 billion Naira. Major contributors to this surge in advert are Telecommunication sector and banking industry, later on joined by food and beverages industry. As the economy grow at higher rate than it current rate of 7%, and the number of middle class increased, the total advert revenue will increase making the industry attractive for more foreign participation who are increasingly looking for more channels to put their investments. For example, the growth of middle class in China and South East Asia were responsible for the influx of Western advertising firms into those markets. Major global advertising firms such as WPP Group and Aegis Group of London have been looking around the emerging economies for suitable market to expand their business. Being the biggest advertising firm in the world in term of revenue, WPP has operations in about 107 countries and employed over 150,000 countries and still looking for more areas to expand. Some global advert firms that have operations in Nigeria include Saatchi and Saatchi, DDB, Lowe Hintas, STB McCann and Rosabel Leo Burnett. Some of the biggest corporate advertisers in Nigeria include such companies as MTN, Glo, FirstBank, Gtbank, Zenith, UBA, Etisalat, to mention just a few. But, as all kind of producers and service providers scramble to get share of the growing middle class income in Nigeria, the size of the industry is bound to increase. Already the industry is a billion Dollar market that employs thousands of people. Corporate advert remain the most creative and highly competitive segment of the advert market where major clients request for the best from any advert firm for it to win a contract. 

  But, for the industry to realize it potentials a number of structural changes most take place in the economy. First of all, the current dwindled fortune of power supply in the country must change in order for the economy and the advert sector in particular to grow without hindrance. Rapid growth in other sectors of the economy such as retail, agriculture, transportation, luxury goods, tourism and hospitality will make it possible for the client base of the industry to grow. A move away from the current unethical and unprofessional practices of some institutions in the industry toward globally accepted practices will do more to help the growth of the sector. Likewise, the continuous training of the available man power in the industry and the increased intermingling with colleagues from the more advanced countries. The industry is in need of individual talents with power of foresight and fresh thinking away from the state of recycling of stale and outdated ideas, as well as some borrowings from the very strong corporate culture found in the banking and the telecommunication sectors that represent the bulk of the clients of the industry. Like some big practitioners have observed, APCON, the regulatory body of the industry, is in need of some fresh thinking and overhauling; in the areas of encouragement of dynamism and reinvention. The industry need to adjust itself for the challenges of the digital age or be consumed by it. Already the internet has shown the traditional media like print media and television, that it alone is the future of advertisement. Advertising as part of marketing communication has played an important role in the development of key brands in Nigeria. And, the future of the industry in Nigeria is bright looking at the current potentiality of the economy, as it moves to enter the league of 20 largest economies in the world.