Outdoor-ad industry faces up to stagnation

More than 71 per cent of European and North American visitors scheduled to attend Sign Asia Expo 2008 late this month cancelled after the state of emergency was declared.

Spending on outdoor advertising will stagnate by the end of the year in the best-case scenario from the Advertising and Sign Producing Association (ASPA).

Overall ad spending experienced only slight growth of 0.17 per cent in the first eight months of the year, from Bt59.3 billion to Bt59.4 billion. But media-research agency Nielsen Media Research (Thailand) reported spending on outdoor ads dropped 5.3 per cent year on year to Bt2.82 billion in that period.

Even though the caretaker government lifted the state of emergency for Bangkok on Sunday, the participants have refused to change their minds, said ASPA president Yuvaphol Pornprathanwech.

The previous government under prime minister Samak Sundaravej declared the state of emergency mainly because of a clash between pro-and anti-government supporters that left one person dead.

Only about 100 foreign participants from the two continents will visit the annual signage fair at Impact Muang Thong Thani from September 25-28. About 250 cancelled out of growing concerns about security in the capital.

Organiser Sakkachat Sivabovorn, who is also CEO of the Industrial Design Network, said the cancellations threatened to delay plans to turn Thailand into a Southeast Asian outdoor-advertising hub.

"It may take another two years for Thailand to reach that goal," Sakkachat said.

He said billboard providers would have to concentrate more on local advertisers instead.

He said local outdoor-ad operators had started the annual event in 2004 in hopes of making Thailand the regional leader within five years. However, political problems like the September 2006 military coup and this month's state of emergency have delayed that goal.

Sakkachat said he hoped some European and North American visitors would attend the event individually anyway, because the cancellations were all made on behalf of the association. That would minimise the impact.

Yuvaphol said the negative effects would be widespread. Not only outdoor ads, but also hospitality businesses like hotel and tourism firms face indirect effects from the cancellations.

He said due to the political crisis and economic downturn, the best the outdoor-advertising industry could hope for was zero growth. If the turmoil does not end soon, revenue will reach only about Bt5 billion for the year, down from Bt6 billion last year.

A reduction in supply is partly to blame for the decline. The Bangkok Metropolitan Administration removed 200 illegal billboards this year, for safety reasons. However, legal operators have benefited from that.