Small increase in advertising spending tipped for this year
Amid concern over high household debt, IPG Mediabrands, a leading media agency, sees advertisers and product owners suspending or cutting their budgets for some media channels in the rest of this year, resulting in only a 5-per-cent increase in advertisin
“High household debt is one of the key factors reflecting weak purchasing power in the local market. Many companies are now worried about their sales target for the rest of this year. This will inevitably have an influence on the pattern of ad spending via each media channel,” Manee Eabe, managing director of IPG Mediabrands’ Managlobal, said last week.
Besides the private sector, the Bank of Thailand is also concerned about the level of household debt at 78 per cent, or Bt8 trillion, of gross domestic product. The central bank is closely monitoring this and is ready to launch control measures if necessary.
Manee said that although the TV broadcasting industry, including free-to-air and pay TV, has changed rapidly due to new players, regulations and technology, the ad spending pattern has largely remained intact.
However, advertisers are likely to switch some budgets for radio and print media such as magazines and newspapers to other channels such as cable and satellite TV and digital media to make a greater marketing impact.
The latest media survey by Nielsen (Thailand) found that from January to May, ad spending still recorded declines of 3.2 per cent for newspapers, 2.6 per cent for magazines, 17.7 per cent for cinemas and 8.4 per cent for outdoor media while radio was stagnant. But free-TV continued to grow by 3.57 per cent and new digital media like the Internet by 55 per cent.
Ad spending witnessed slight growth of 1.1 per cent to Bt45.62 billion from Bt45.12 billion in the
same five months last year, according to the survey.
Nuti Khemayodhin, managing director of Media Scene, the operator of two satellite TV stations, Media Channel and Media News, said his company enjoyed a good response as advertisers continued to spend on his media outlets.
The company expects to double revenue to Bt200 million for this whole year.
According to the Media Agency Association of Thailand, viewers are also migrating from traditional to new media.
Manee predicts that, due to economic pressures, ad expenditures this year would rise by only 5 per cent from Bt113 billion last year.
