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IF high
oil and food prices, as well as the global economic
slowdown, persist or worsen, advertising spending in the
Philippines may revert to post-Asian financial crisis
(AFC) levels by year-end or in the first half of 2009.
In a
presentation, Nielsen Media Research executive director
Jay Bautista said high commodity prices will not only
affect Filipinos as a whole but also media companies,
particularly the print industry.
Based on
its State of the Nation Advertising report, Bautista
said that from January to June 1998, the country
experienced a 2-percent drop in total media spending due
to the AFC.
This
drop is largely due to a 14-percent drop in ad spending
for the print industry and 8-percent decline in ad
spending for radio. Bautista added that while ad
spending for the television industry posted a growth, it
was slower at only 4 percent.
Similarly, total advertising spots during the period
right after the AFC posted a decline of 13 percent.
This was due to a 16-percent drop in advertising spots
in newspapers and magazines, 13-percent decline in radio
advertisements, and an 11-percent drop in television
advertisements.
What was
notable during the period right after the 1997 AFC was
government advertising spending, 1998 being an election
year and which coincided with the celebration of the
Philippine centennial. The government spent P1.820
billion in advertisements from January to June 1998,
which accounted for a 73- percent increase in ad
spending and 45-percent increase in advertising spots.
“If this
[high oil and food prices] trend continues, this may be
the scenario we will be looking at this year or 2009,
depending on how fast the trend ensues,” Bautista said.
“If high oil and rice prices continue, then we might see
that consumption spending will shrink.”
Bautista
said that while the ad spending made by most private
firms is growing in the first half of 2008, the economic
uncertainties are looming and have already begun
affecting advertisements made in most traditional media.
From
January to June 2008 the survey showed that total
advertising spending increased by 15 percent on the back
of a 26-percent growth in ad spending for the radio
industry. The television and print industry posted a
13-percent and 12-percent growth, respectively.
In the
same period, the Nielsen survey also showed that total
advertising spots are slow in growing with only an
11-percent year-on-year growth.
Bautista
said despite the 14-percent growth in advertising spots
in the radio industry, television ad spots are slow in
growing with only a 3-percent growth and was almost flat
in the print industry, which only registered a 1-percent
growth.
Meanwhile, the bulk of the ad spending among the top 5
industries are the food, pharmaceuticals and beverage
industries, which posted ad spending growth of 38
percent, 47 percent and 53 percent, respectively.
The food
industry spent as much as P11.021 billion in
advertisements in the first six months of the year,
while the pharmaceutical and beverage industry spent
P10.21 billion and P9.137 billion, respectively.
However,
the top industry spender were companies which belonged
to the personal-care industry, which only posted an ad
spending growth of 9 percent, but had invested a total
of P17.458 billion in the first half of the year.
The last
industry which made up the top 5 industries in terms of
ad spending was the telecom industry with a 4-percent
growth in ad spending to P6.404 billion from January to
June 2008.
In terms
of advertising spots, personal-care products posted a
decline of 42 percent; food posted a growth of 47
percent; pharmaceuticals, 9 percent; beverage, a decline
of 3 percent; and telecom, a growth of 29 percent. |
