Ad media body now sees zero growth in 2014 expenditure

Economy July 01, 2014 00:00

By Watchiranont Thongtep
The Nat

2,628 Viewed

Industry suffers 9% year-on-year decline in first 5 months

The Media Agency Association of Thailand (MAAT) has cut its advertising-expenditure forecast for this year to no growth from the previous projection of 3.5-per-cent growth after the industry suffered a 9-per-cent year-on-year decline to Bt47.62 billion in the first five months. 
The political unrest and economic slowdown in the first half were blamed as the key factors. 
“We expect that overall advertising spending for this year will be about Bt136.16 billion. That means there will be no growth this year,” MAAT president Wannee Ruttanaphon said yesterday. 
After the military seized power from the caretaker government and the political and economic situation improved, key corporates and brands, particularly in consumer products, real estate and banking services, are resuming their marketing plans and advertising spending to boost sale in the second half.
Wannee said that although advertising spending was coming back, it was not enough to result in positive growth by the end of the year. 
Of total spending in the industry, analog terrestrial TV will still take the lion’s share at 60 per cent or Bt70.1 billion while digital terrestrial TV bring in about 4 per cent, or Bt4.9 billion.  
The MAAT expects advertising on cable and satellite TV will shift to digital terrestrial television. By the end of this year, spending on cable/satellite TV will drop to Bt8.1 billion from Bt13.21 billion last year. 
Advertising investment via other media follows the same trend. In-store adverts will see a 13-per-cent decline to Bt2.65 billion. Magazine ad expenditure will decrease to Bt5.5 billion from Bt5.95 billion. 
Digital media to buck the trend  
But digital media and transit advertisements are expected to see growth. For example, spending via digital media will enjoy a 38-per-cent surge to Bt5.86 billion while transit adverts will grow 8 per cent to Bt3.8 billion.    
The MAAT also revealed its latest CPRP (cost per rating point) estimate for advertising media and agencies and brand owners. The CPRP reflects inflation in the advertising industry. Media inflation is calculated by comparing annual price changes for advertising via various media and viewers’ behaviour. 
CPRP is the cost of reaching a set audience quantity. If CPRP inflation is higher than the general inflation rate, this means low effectiveness in advertising spending. 
Khanokkhan Prajongsangsri, business director for investment and knowledge at IPG Mediabrands, said CPRP in TV spending this year was quite high at 15 per cent. This resulted from three factors. First is that Nielsen (Thailand) has included TrueVisions in its survey panel since early this year. Second is a shift to the digital terrestrial TV platform, and the last factor is multi-screen behaviour.