Nigeria advertising sector: Path to growth
The advertising industry in Nigeria must use this unique period of buffeting from global shocks to reflect and prepare a roadmap that sets out how the sector can make a greater contribution to GDP and put itself on a path to sustainability and prosperity. In my opinion, there are five key areas to address if the sector is to become more relevant and grow in post-Covid-19 pandemic and the oil price trade war. These five areas are:
COLLABORATION AMONGST INDUSTRY LEADERS: There must be a coming together within the advertising industry to create a leadership and advocacy group. This group will be a task force of forthright leaders from the relevant Industry bodies, including but not limited to: Advertisers Association of Nigeria (ADVAN), Media Independent Practitioners of Nigeria (MIPAN), Association of Advertising Agencies of Nigeria (AAAN), Broadcasting Organisations of Nigeria (BON) and others. The purpose of this group will be to devise The Strategic Advertising Plan for Nigeria to promote and dramatically grow the advertising sector.
SET A QUANTIFIABLE TARGET FOR SECTOR SIZE: The advertising sector should be assessed based on its per cent contribution to GDP. In GDP country rankings Nigeria GDP $397billion is currently the largest economy in Sub Sahara Africa followed closely by South Africa GDP $366billion. The South African advertising sector is $2.6billion (.7% of GDP) and this is almost six times the size of the Nigerian advertising sector $450M (.1% of GDP). The Nigerian Advertising Industry clearly underperforms, and for many reasons both macro and sectoral issues which are already well known. However, it is my belief that with a proper strategic plan that the Nigerian Advertising sector can grow to at least $1billion (.27% of GDP) in size. Such an ambitious growth target and when achieved means that the sector becomes more viable and more important as a contributor to the growth of the economy. Services such as financial, communication and IT currently contribute 50% of Nigeria’s GDP and the advertising sector must begin to play its part in this. Such plans for sectoral growth will be welcomed by policy makers already tasked with moving Nigeria to a more diversified economy and away from a dependency on oil for foreign export earnings.
ENGAGE RELEVANT MINISTRIES AND PARASTATALS: The advertising leadership group must engage with each of the relevant Ministries and Parastatals, and bring them on board with The Strategic Advertising Plan for Nigeria. These institutions must be persuaded that a dynamic Advertising Sector can help drive the Nigerian economy. In other territories research has shown the huge contribution the advertising sector can make to the well-being of the economy. The Value of Advertising report, an independent study by Deloitte, highlighted the advertising sector’s ability to drive economic growth across the EU. The report identified a multitude of benefits generated by advertising, to the overall economy, jobs and to civil society. Nigeria’s Ministers will be interested to learn that the Value of Advertising report found that for every Euro spent on advertising powers a seven-fold boost to GDP, encourages innovation, and supports employment. A similar body of research work must be carried out in Nigeria now to support the rationale for investing to help grow the sector. Imagine how powerful an argument it could be to present to Federal policy makers if research could prove that alocal advertising sector of $1billion could possibly power the Nigerian economy to the tune of $7billion (1.7% of GDP). State funding would be released to support and “kick start” the advertising sectors drive for relevance and growth.
THE ADVERTISING FUND AND COMMUNICATIONS PLAN: In turn the State must work hard with the sector to create an Advertising Fund which will then be reinvested back into: new talent, training and technology, areas where currently the lack of funding is currently holding back the sector. The advertising fund can come about in any number of ways including offering tax credits on advertising investments and tax credits on incremental year on year advertising spend. The sector must then create an ambitious, and consistent communications plan to tell other stakeholders of its plans for relevance and growth. The stakeholders are the other sectors in the Media and Entertainment Industry including: Nollywood, Music, and Producers. As part of this communications plan stakeholders must be reminded of the unique role advertising plays in the economy and the incremental value advertising delivers within the communications ecosystem. The communications plan must include robust industry analysis, reports and case studies. Stakeholders must be left in no doubt but that the Advertising sector has a catalytic effect on the broader economy.
GLOCAL AMBITIONS: A policy of Nigeria First is of course important but if the Nigerian Advertising sector is to truly prosper then it must also incorporate the very best that the Global Media and Entertainment Industry can offer. Global and local (Glocal) must work together. I advocate that Nigeria can become the African hub for advertising companies and indeed for all media organizations including news agencies, publishing, online media, production, and broadcast facilities. The ambition must be to establish Advertising Free Zoneswhere companies operating in these zones are exempt from all types taxation such as Value Added Tax (VAT), Income Tax, Corporate Tax and Customs. Business owners in the free zone will have 100% ownership of the business. The advertising sector then becomes a key central part of the Media & Entertainment sector in Nigeria, Africa and beyond!
About the author: Ronan Redmond is an International advertising leader who specializes in growing commercial media in Africa.
RECOMMENDED ARTICLES
Comment
No comments found.