Outdoor clutter creates client churn

As Nakheel revaluates its outdoor advertising strategy in the UAE, media buyers must ensure client value or they will face an exodus.

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By  Rob Corder Published  May 22, 2005

|~|Nakheel-Billboards---Al-Gar.jpg|~||~|Outdoor advertising has long been a favourite vehicle for Middle East media buyers. The last two years have seen particularly dramatic growth, especially in and around the United Arab Emirates, the Kingdom of Saudi Arabia, Kuwait and Lebanon. For example, research analysts at Ipsos-Stat report that just under US$60 million was spent on outdoor in the GCC during the first quarter of 2005, accounting for 5% of total ad spend in the region. However, in the UAE, that figure grew to 11% with just under US$7 million being spent on outdoor. Within Kuwait, Lebanon and Saudi Arabia, the percentage of ad spend being funnelled into outdoor is even higher at 17%, 23% and 38% respectively. The primary, and widely accepted, reason for outdoor advertising is that it provides mass-market visibility for clients and large canvases on which to present bold messages and stunning creative. Political parties in a general election are classic exponents of the art. Maurice Saatchi’s “Labour Isn’t Working” slogan, which helped to bring Margaret Thatcher’s Conservative party to power in 1979, is often quoted as one of the greatest outdoor advertising campaigns of all time. The message was simple, direct, intelligent and designed to be consumed by the entire British population. Flashes of genius like these are found once in a decade in mature markets, and almost never in the Middle East. And yet outdoor media attracted over US$150 million in regional advertising last year, and that figure could double in 2005. The reasons for outdoor advertising’s popularity are manifold and illustrate a pattern of thinking among Middle East media buyers that newspapers, television stations and magazine publishers can all learn from. The local advertising industry operates in several seemingly paradoxical ways. Among them is that ad agencies are adverse to taking unnecessary risks with their clients money, and yet they operate in one of the most risk-ridden markets in the world. Not only are there risks associated with potential political instability, but there are risks associated with buying advertising in a market where only a small percentage of media is audited, and the industry is littered with sub-standard, fly-by-night media companies that are in business one day and bankrupt the next. In choppy waters like these, advertisers look for safe harbours where they can park high value blocks of advertising. While an international vice-president flying in from New York or Tokyo might question the circulation, quality, positioning and respectability of a newspaper or magazine in which an advert has been booked, a well-lit, well-constructed, well-placed billboard on the side of King Fahd Highway in Riyadh or Dubai’s Shiekh Zayed Road is unlikely to attract the same intrusive scrutiny. What’s more, outdoor advertising provides a faster and simpler way media buyers and their agencies to make money. The purchase of a single high value billboard costing US$250,000 for three months is simpler than spending the same US$250,000 across a number of newspapers, magazines and radio stations. The media buyer’s commission is therefore more lucrative on a simple hourly rate calculation. There are signs, however, that the safe harbour afforded by outdoor advertising may be getting choked. Nakheel, one of the region’s largest property developers and largest users of outdoor media in the United Arab Emirates, says it is changing direction. Outdoor has become too crowded and it is impossible to stand out amid the clutter, even with such dramatic projects as The World and Palm Islands to promote. The outdoor medium has become a victim of its own success, and some of its intrinsic strengths are beginning to become diluted. Whether Nakheel’s decision will have broader repercussions for the outdoor industry remains to be seen, but it does point to the fact that the media — be that outdoor, print, broadcast or online — need to keep innovating and reinventing themselves to stay relevant to the most demanding advertisers.||**||

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