Local ad industry keeps eye out on economy

As in 2016, the state of the economy will be what regional advertisers and their clients are going to fixate on this year even as they focus on what platform they should use for which campaign. But unlike in 2016, they see enough reasons out there to hope for better later in the year and beyond.

“Short-term analysis of numbers are the reason businesses are going myopic … (instead) prudent marketers should be preparing themselves for the expected 25 million visitor target for 2020,” said Amit Raj, General Manager at BPG Maxus. “The economic buoyancy leading to 2020 is expected to start in 2017.

“Government investment on infrastructure and facilities will only raise the business mood. If the two months into 2017 are any indicator, we notice a positive mindset from clients to begin with. The intent will lead to innovative solutions and investments in appropriate areas.”

Overcoming short term concerns with a more upbeat longer term vision is what the annual Dubai Lynx advertising industry conference which opens Sunday will hope to showcase. As such, the January ad spend numbers will be memorable for all the wrong reasons. Overall newspaper ads were down 35 per cent compared with January 2016, while magazines recorded a 40 per cent decline, according to BPG Maxus estimates. Radio suffered as well, lower by 13 per cent across the category against the tally from January 2016.

The local media industry is trying to learn on the go. Publications have been shuttered or downsized in a bid to adapt. And strategies are being revised to suit the times.

“Media that has been collaborative, flexible and have shown business solutions have actually benefited with better media investments,” said Raj. “We see media understanding this and as a result convergence is happening in the offering.”

Convergence is a word that the ad industry will be hearing a whole lot of. The region’s favourite video platform YouTube will soon be enticing viewers to get their TV viewing done through it as well. YouTube TV’s launch will make it a “one-stop space for all video content”. And there is Facebook that is going way beyond sharing to an eCommerce and video streaming platform.

Choices — regional consumers will have so much more to cram into their 24 hours.

At some point, marketers will have to get back into their spending habits.

“Despite the Brexit and the world economy, advertising spends in the UK are up versus 2016,” said Rakesh Kumar, CEO of marketing services firm Human. “This is symbolic of the marketing world realigning budgets.

“In the Middle East, we are in for a downturn should the agency and the clients don’t undertake radical steps to change and evolve. The issue is a stagnancy in approach and traditionalism in thinking, which is restricting the region from future growth. A change is inevitable on both sides of the table.”

After a decline by about 20 per cent in overall ad spend during 2016, most industry sources predict this year’s could be in for another double-digit dip. The bigger networks have spent the whole of last year trimming expenses where they can, extensive internal restructuring, and taking in people only when there is an actual need. There have also been instances of new entities opening up bases in Dubai/UAE, many in the field of data analytics. That is one category still in sunshine mode.

Many agencies have also been beefing up operations at their Beirut operations, most recently the media entity PHD, part of Omnicom.

* Within digital, the local retail sector made a concerted push to spread the word on digital this January, up by 89 per cent from a year ago. These messages were mostly about end-of-season promotions or sales. Banking and finance offers and jewellery also made a push into digital domains, with spends up by 24- and 28 per cent, respectively, according to BPG Maxus estimates. But with offline media, real estate ads showed up more, a gain of 9 per cent on January 2016.

* At this year’s Lynx, there is a new award category for innovation, which “celebrates pioneering technological creativity”. Entries need to demonstrate the relationship between a big idea and radical tech. A new section for music has been added to branded content and entertainment, recognising music content and musical collaborations.

* The Dubai Lynx annual series opens Sunday and runs until March 7. Winners for the many categories will be announced at the conclusion

source : gulfnews