Signs and billboards of the economic times
Signs and billboards of the economic times
These are hard times for the outdoor advertising industry. Revenue from outdoor advertisements has decreased dramatically. Billboards which once flicker nightly now remain dark and quiescent in both day and night.
Nguyen Quy Cap, Chair of the HCM City Advertisement Association, noted that advertisement is an industry whose fortunes are tied closely to those of the national economy.
As Vietnam is still in the doldrums with a frozen real estate market, cold stock market and problematic banking system, the ad industry has not been able to perform well.
Cap said the market will still be gloomy in the second half of the year, as the industry faces not only difficulties from the economic recession, but also strict regulations in force since the new ad law took effect.
The current regulations, for example, stipulate that billboards must be set back from the roadside by at least five meters. Very few streets in HCM City have the pavements wide enough to satisfy that requirement.
The HCM City Advertisement Association has asked the city’s authorities to reconsider the regulation.
“If the regulation cannot be amended, the number of outdoor billboards in the city will be cut by 50 percent because they cannot meet the standards,” Cap warned.
Also according to Cap, in the past, when the economy prospered, businesses budgeted some $1 billion a year for ads, including $100 million for outdoor ads.
But now, he estimates, revenue from outdoor billboards has dropped by 40 percent during the first half of the year in comparison with the same period last year.
“You may see that a lot of billboards, including the ones installed in advantageous positions, remain empty. It is because the companies which paid for the ads had to shut down business after repeatedly taking losses,” he said.
The director of an ad firm noted that it is very difficult to find clients willing to sign long-term (2-3 year) contracts today. Many big brands, which used to spend lavishly on outdoor billboards, are now cutting their outdoor ad budgets. They have been replaced by consumer goods brands which favor short-term ad campaigns to serve their short-term sales campaigns.
Even the eight billboards by the Saigon riverside in HCM City – once the most coveted outdoor-ad “real estate” – have been largely idle over the past year. In the past, the billboards were fully occupied by big international brands. However, the brands’ images have been removed since early 2013. Visitors to the area now see no ad messages on the billboards – only one with an out-of-date greeting from the city’s people’s committee: “Chuc mung nam moi” (Happy New Year).
A source said that previously, clients paid an average of $250,000 annually for a riverside billboard. As the demand has fallen, owners of the billboards have cut the fees to $150,000.
The source said he has heard that a new 4-month lease on a billboard has been signed by Heineken, a beer brand.
vietnamnet
