EXMAN President charges agencies on Optimizing budget
By Oghale Mafuru
As the economic challenges continue to reduce purchasing power and consumption across all sectors of the economy, clients are seeking ways to maximize the shrinking advertising budget with increased need to prove Return on Investment, ROI. It is against this backdrop that the President of the Experiential Marketers of Nigeria, EXMAN, Tunji Adeyinka has urged agencies to be more innovative and proactive in their service delivery to optimize advertising budget through the use of data and market insights.
The EXMAN boss who is also the Group Managing Director at Republicom Group gave this charge in a webinar recently where he made a critical review of the impact of the economy on the advertising and marketing ecosystem. According to him, the client-agency relationship has been affected by the current economic climate with its attendance effect on consumer bahaviour and purchase decisions.
He noted that clients are now very critical about advertising spend and would require service providers and agencies to prove the value of investment.
“If we look at the business of our clients, starting from that point or even starting from the economy, what we tend to continue to see is that consumer spending continues to be impacted negatively. So, we have an erosion of disposable income which means that consumers are not able to buy or spend as much as they were spending. The spending is not just affected, it means that they will be trimming down to value-oriented goods rather than luxury goods. It means that the clients that we work for who are in the luxury segment of the market will need to think twice about how their businesses are structured.
“A lot of our clients are now cost conscious. They are conscious of every cost that goes into the total cost of delivering their product. What we are finding is that clients are under serious pressure, therefore the way that they engage with agencies and service providers have changed fundamentally and a lot of agencies need to be conscious of the kinds of changes that we are seeing”.
The marketing expert who pointed out that clients are rethinking their engagement structures with agencies due to the need to reduce cost, stated that clients are in a dire situation having to grapple with the challenges related to production and distribution.
“We are having a lot of challenges seeing a lot of disruption in distribution, in how goods are distributed across Nigeria. So, part of what we see in the poverty index is also indicative of how difficult it is to reach some in the market especially in the North in the last one to two years. What it means is that the communication that must reach those consumers especially when you are looking at an area where purchase, plan and distribution is becoming challenged. So, agencies are becoming partners who are distributing and redistributing to those areas where you have a lot of challenges”.
He urged marketers to leverage data and consumer insights for effective and result-oriented solutions to clients.
Meanwhile, advertising spend has been projected to increase this year with major attention shifting to digital platforms. As clients rethink business strategy to mitigate the economic impact, Return on Investment and increase in product purchase remains a critical factor for investment decisions on advertising budget.
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