Written by: Igwe Okeke, Media Director for Carat Nigeria
The Nigerian advertising industry will continue to evolve in 2017 as new advertisers in relatively obscure categories begin to emerge. The likes of Minimie Chichin, Google, the betting companies and others have taken the air waves by storm in 2016. More will come in 2017 and beyond!
The emergence of this new advertisers is an indication of the market dynamism and the things to expect in the coming years despite the harsh economic situation of the current season.
The telecommunications and brewed beverage categories have dominated the nation’s advertising industry spend for decades. It is a given to say the frontline space is reserved for these players in the market place. In 2015, the Telecoms category accounted for about 16% while brewed beverages contributed 10% of total ad-spend in Nigeria as derived from Media Monitoring Report for that year. It has become almost a convention to see this type of trend year-on-year. No doubts, the trend will continue but not without new advertisers emerging from various private businesses and SMEs to seek recognition and attention of over 186 million people of various ages and social classes.
Interestingly, the economic situation in the country can be viewed to have both positive and negative effects. While the GDP continues to slope in 2016, entrepreneurs and consumers are beginning to devise alternative means of profiting and surviving. One wonders if the basis for the calculation of the nation’s GDP is correct since the informal sector is a key driver of the economy with numerous unregistered roadside and open market businesses. According to Trading Economics, Nigeria’s GDP per Capita has remained stabled at $2548 and expected to exit Q4 2016 at this rate. Though this is expected to drop marginally to $2545 in Q1 2017, it is forecast to hit $2790 by 2020. It will be safe to continue to say that the informal sector as well as individual efforts will continue to drive personal income levels of Nigerians going into 2017 and the future. This may continuously result in the emergence of new categories and sub-categories looking for affordable means of promoting their products. Already the industry media space and time are filled with advertisers of betting platforms (e.g. Bet Naija, Winners Golden Bet, Naira Bet, etc.), technology solutions (e.g. Google, Tecno Phones, Huawei, etc.), Fast Food (e.g. Minimie Chinchin, etc.).
By implication, these new categories will contribute to media clutter increase which in effect will lead to further rise in demand for airtime and space. Consequently, advertisers should anticipate media rates inflation in 2017. This is further reinforced by high cost of production driven by national inflation hike expected in excess of 18% in 2017.
What should the advertiser do in this regard? This calls for deliberate media buying strategy by advertisers and their media agencies. Such should include early long term commitments to avoid the rates increase hammer, optimizing media with the best rated media channels and contents, exploring biddable opportunities especially via digital and unlocking the potential of video optimization to deliver objectives cost effectively.
In summary, though the economic situation is harsh at the moment, there are opportunities arising from SMEs and private initiatives as well as indicators of light at the end of the tunnel. Now is the right time to tap into these opportunities.