TVs spur 38pc growth in regional ad spend

DUBAI - Spurred by a robust growth in television advertisement revenues, adspend in the Gulf and the Pan Arab markets soared some 38 per cent from $1.26 billion in the first half of 2003 to $1.74 billion in the same period this year a period that also witnessed a slight drop in the market share of the print and the outdoor media.

By Isaac John

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Published: Sun 29 Aug 2004, 10:20 AM

Last updated: Wed 1 Apr 2015, 11:54 PM

A study published by On media shows that the first half of 2004 confirmed the prominence of TVs in the regions adspend, reaching 48.6 per cent. As the share for print media dropped below 47 per cent, the outdoor advertisement segment saw its share being reduced to just above four per cent from 6.1 per cent in the same 2003 period. 'This will come as a surprise considering the explosion of media opportunities in outdoor and the major price increases resulting from the high bids put forward by contractors to win their licences. Radio and cinema still struggle to reach one per cent between them,' says the study by the quarterly newsletter.

'Closely linked to business confidence, the regions adspend shows strong signs of heading in the right direction. It appears that the first half of the year supports the prediction of a return to stable growth in the industry for 2004, both globally and for the Middle East,' the study said.

While the television segment consolidated its share of the total adspend to 48.6 per cent from 43.8 per cent in the 2003 first half, newspapers skidded from 40.7 per cent to 39.5 per cent, magazines dropped from 8.6 per cent to 7.2 per cent. However, in terms of revenues, televisions, newspapers, and magazines recorded growths of 53 per cent, 34 per cent, and 16 per cent respectively. While revenues generated by outdoor advertisements dropped three per cent, radio posted a fall eight per cent respectively. The revenues generated by cinemas plummeted by 16 per cent.

'TV has grown faster than the overall average across the two periods, with satellite TV growing by 57 per cent, while local TV showing an average 38 per cent growth. This calculation is based on the recorded commercial airtime,' the study pointed out.

'This slight growth in newspapers ad revenues is potentially explained by the fact that construction and real estate have recorded an amazing growth in adspend between 2003 and 2004, multiplying their adspend by four and three respectively,' it said.

According to the study, while cars led the advertising pack, the category has grown less than the average 38 per cent, while banking, in second place, barely matches that growth. 'Publishers, however, have significantly increased their advertising activity. This could be also be explained by the intense launch activity from the Dubai Media City.'

The study felt that the monitoring of outdoor, radio and cinema can still be improved and figures do not reflect the levels of negotiation between media owners and agencies. 'This unavoidable inaccuracy hides the fact that as a result of different levels of discounting, newspapers actually take the lions share of the regions adspend. And while there is no doubt that the level of advertising expenditure has improved over the period, it is estimated the real growth to be closer to 5 to 10 per cent.'

April was the worst month overall in the first half of 2003, while in 2004, it was February that featured the smallest adspend for the period. 'Predictably, March and April showed the biggest jumps in 2004 compared with a year prior, reaching some 70 per cent in April, to then slow down until June.'

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