Amid Uncertainties, Advertising Set for A Good Year

Amid Uncertainties, Advertising Set for A Good Year

Despite the uncertainties that usually surround every electoral cycle and the global economic uncertainty, players in Nigeria’s marketing communications landscape are confident that the modest 2.5 % GDP growth projection for 2023, would bring about a decent fiscal year for the industry, reports Raheem Akingbolu

In view of the activities in the marketing communications industry in the year 2020, 2021 and 2022, it’s obvious that more strident factors would shape operations in 2023, top Nigerian practitioners have admitted. According to them, global trends are changing, so local trends cannot stay the same. They have also predicted that there would be a push by consulting firms to continue to rev-up their digital practices and give direct competition to traditional agencies. On the question of whether the various reforms embarked upon by the Advertising Regulatory Council of Nigeria (ARCON) would positively strengthen the industry in 2023, most practitioners answered in the affirmative but added that it would be gradual, stating that the impact will resonate further down the line. On the global scene, it’s also believed that Russia’s war on Ukraine will come full cycle and negatively impact the industry.

However, with the direction of the Central Bank of Nigeria’s monetary policy- new naira notes and a peg on cash withdrawal limits, analysts are of the opinion that if these policies go forward as currently being pushed there will be a squeeze on liquidity and it will have an impact on campaign spend. Pundits have also indicated that with increased interest in TikTok ads and short-form video content, digital media will continue to grow in 2023.

Speaking to THISDAY on what to expect this year, the Managing Consultant at Precise, a Reputation Design firm, Mr. Bolaji Okusaga, said, “We see a move to deepen the idea of the conversation economy using technology as opposed to guts and intuition and so we see a rise in Analytics and we see data becoming the heart from which strategies evolve. Traditional Agencies need to raise the stakes or the major consultancies and business advisory practices will take them out within the next decade. The game has got to change and the volatility and uncertainty which 2023 offers present a great opportunity to make that change,”

Reforms and Expectations

With 2023 general elections around the corner, there are mixed feelings that the exercise could mar or make the marcom industry. For instance, the election and the uncertainties that usually surround every electoral cycle may impact Q1 performance as most clients may want to adopt a wait and see approach. As observed by the President of the Association of Advertising Agencies of Nigeria (AAAN), Steve Babaeko, “The continued attrition in the oil sector coupled with the change in monetary policies may also constitute a major headwind for the first quarter. This notwithstanding, I am very optimistic of a post-election bounce and with a modest 2.5 per cent GDP growth projection for 2023, it should be a decent fiscal year for advertising.”

The International Advertising Association (IAA) Nigeria President, Dr. Tunji Olugbodi, who argued that no significant revenue would likely accrue from political marketing, hinged his conclusion on the fact that political campaigns have become very much a DIY thing. “Besides, it’s seen more as a feeding frenzy opportunity rather than a chance for robust qualitative communication and engagement. It is also reflective, in part, of the expectations and aspirations of the electing public who hold nothing to close scrutiny or deep accountability. Most of the chat room discussions are very pedestrian and driven by hunger and poverty mentality, rather than values and principles.

“My wager is that marcom being a reflection of the society- in terms of socio economic construct – will continue to devolve and evolve. Devolve to mirror the continuous downward trend in global economic performance such that it caters for interests on “bite size “ options to which impending recession and inflation has consigned it to. And also evolve on breaking new value streams that offer more pragmatic solutions that feed the new consumerism attitudes,” Olugbodi said.

Despite the gloomy outlook, the President of the Experiential Marketers Association of Nigeria (EXMAN), Tunji Adeyinka is optimistic that there would be a higher spend on advertising from the candidates from this month as the country approaches the elections in February and March. He also pointed out that the challenges in the market could bring opportunities.

“In human history, the most challenging periods have always been the greatest opportunities for change and innovation. Despite the concerns that always go with our transitions and elections, we have always emerged better than expected. With the candidates that are featuring in this election, the front runners are market-driven candidates and that gives us an assurance about the likely policies that will be positive and market oriented. Any candidate that wins has his job cut out for him and we believe that if they do the right things the economy will grow and the marcoms industry will also grow. That is the scenario that I have chosen to embrace. This is also encased in a time of monumental and defining changes in the marcoms industry globally. We see cautious growth, especially if the winning candidate is bold.

“However, I am disappointed with what I have seen so far, not just around the lower spend but also in the strategic and creative output. We have not seen very strong, single-minded campaigns driven by consumer insight and a conviction birthed out of our situation. We have seen a lot of platitudes and big media exposures but not much by way of relevant and creative messaging. We still have a few weeks to go before the elections but if we go on at this pace, this may turn out to be the ‘drabbest’ campaign season. Once more, let us hope we are proven wrong in the next few weeks,” Adeyinka said.

Speaking on ARCON reforms, Adeyinka said even though some analysts have concluded that 2022 was a year of reforms, especially in the Marcom industry, he pointed out that 2023 must be a year of doubling down, active conversations and percolation. “We now need to dig deep and invest time in active conversations and collaborations if the reforms are to make any meaning. Businesses are likely to be cautious in the face of these reforms as they seek to understand. We must not lose the opportunity to have deeper conversations and throw away all the grand-standing.

Out-of-Home Sub Sector

For the players in the outdoor sub-sector of the advertising industry, it’s not yet uhuru as practitioners are still receiving bashes, front and back from various state governments’ owned signage agencies. According to the President of the Outdoor Advertising Association of Nigeria (OAAN), outdoor advertising practitioners have seen worse days but are still sustaining the tempo to keep the industry growing.

He said: “Much as it is still early in the day, we have great hope that even with the reduced economic activities, we will still have enough to keep us busy. My greatest worry is the lack of understanding by our signage agencies and other government agencies that manage our business. As I speak, we are still not able to practice in Kaduna. The DG of KASUPDA just woke up and reduced all my members’ investments to nothing with one policy of theirs. This is a government that prides itself as encouraging ease of doing business. Who can invest with so much uncertainty in the environment? This is actually our major concern. Our Government partners should see us as partners and all will be well. Every election year comes with the opportunity of doing good business. So far, it will seem that this election circle is going to be different. However, we hope that now that the elections are getting closer, the politicians will do more marketing of their potential and by doing so, we will be better patronised. It could also be because of INEC monitoring of election expenditures. Whatever is the reason, we hope that we will still see some political advertising action. 

While admitting that the economic indices are not favourable, especially as fuel scarcity is also part of economic problems, he stated that the anticipation of a new government is the necessary impetus to keep hope alive.

Speaking on reform, Ajufo who commended ARCON Director General, Dr. Lekan Fadolapo for his proactiveness, called on the federal government to institute the long-awaited ARCON Council. “We have a very knowledgeable and energetic DG, who wants to better the industry. We are fully in support of the reforms and we hope that we will begin to feel the impact more from this year. It will also be wonderful to give us a Council. For a long time, we have been without a Council. I think that the government has not been too fair to an industry like ours with these huge potentials.

“Outdoor advertising Agencies are endangered with the way and manner that our government Stakeholders treat us. I strongly believe that the role of signage agencies should be that of setting standards for us to follow. What we have however, is that because they are more interested in IGR, they lose the reason for being there in the first place.

“Part of the reform we talked about concerns those who should practice Outdoor Advertising. A lot of companies doing this business with the licence of the Signage Agencies are not ARCON Licenced,” Fadolapo said.

Public Relations

With the likely shrinking spend within the advert space in 2023, some analysts have predicted that there would be an upswing in the PR sub-sector. Reacting to this, Okusaga pointed out that there are a lot of areas where PR may be able to make more impact during a challenging period. “From all signals, Public Relations practitioners may experience boom in their businesses in 2023 because it’s always the best bet when it comes to Policy Advocacy, Corporate Lobby and Litigations Communication on the Corporate PR end; to PR stunts for brand launches and brand storytelling on the Consumer PR end to Investor Relations and Analyst Liaison on the Investor Relations end. This may well be a year for the resurgence of PR given the increasing price sensitivity of Clients and policies which are constricting the space for traditional advertising. Again, I will counsel caution as these projections are subject to what Economists will refer to as “all things being equal,” Okusaga said.

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