With a crippling debt, running into billions of naira, on its shoulders, and very ‘hostile’ regulatory environment to cope with, the out of home (OOH) advertising practice cannot be said to be having a swell time in Nigeria.
Not too long ago, operators had protested the refusal of a state outdoor regulatory agency, the Lagos State Signage and Advertising Agency (LASAA) to pay some funds, running into billions of naira, being owed by the agency for jobs executed for the agency during the last electioneering campaign in the state.
While the debt issue still lingers, the latest threat, which, many believe, constitutes the most potent, is that which the convergence of digital and technology have continued to pose to this once vibrant sub-sector of the nation’s advertising industry.
Not a few have argued that with the convergence of digital and technology, the outdoor advertising practice is being left with no other option than to re-invent itself or go into extinction.
Interestingly, the recently-held Summit of the Outdoor Advertisers’ Association of Nigeria (OAAN), again provided the platform for stakeholders to discuss this clear and present danger, while also proffering solutions to some of these challenges, threatening to send the practice the way of the dinosaurs in Nigeria.
For instance, in his keynote address, delivered at the summit, held to mark this year’s Poster Award of the outdoor Association, the Chairman of Troyka Group, Mr Biodun Shobanjo identified the myriad of odds stacked against the growth of outdoor practice in the country, noting that the inability of stakeholders to urgently address some of those odds in the past had been responsible for the steady decline in fortunes of the practice in Nigeria in recent times.
Shobanjo argued that while the convergence of digital and technology had made it imperative for operators to re-invent themselves and, by extension, re-engineer the practice, he however queried the wisdom behind the proliferation of outdoor advertising firms, as being presently witnessed.
“I believe one of the reasons the industry seems not to be growing, of late, is that the number of outdoor advertising companies in Nigeria is rather huge. You are just too many for this type of business.
“Outdoor advertising is a serious business that requires huge capital, knowledge and skills. That is why in most countries, such as the United Kingdom, the number of outdoor firms practising there is about five. In those countries, you cannot see the type of crazy charges that are being given to practitioners here because governments in these countries know that outdoor advertising business is a serious business and the players are worth listening to,” he argued.
While calling for merger and acquisition among the existing numerous outdoor advertising firms in the country, Shobanjo believed such collaboration would enable the companies shore up their capital base and reduce their over-head costs,” he argued.
Throwing his weight behind the Troyka Group boss, former Managing Director of the LASAA, Mr Makanjuola Alabi stated that outdoor advertising firms must collaborate to enable them add value to their clients’ businesses.
The former LASAA boss argued that, if practitioners are ready to collaborate, some of the problems currently facing the industry would be addressed.
According to him, “the present rate regime of the agency, roundly criticised by operators, remains one of the ways of curbing in the industry.
“It is a way of raising the entry barrier to ensure that people just don’t wake up one day and begin to practice outdoor,’ he stated.
Interestingly, the President of OAAN, Mr Tunde Adedoyin believes that despite the myriad of issues facing the sector, the nation’s outdoor advertising practitioners have what it takes to compete effectively with any of his peers anywhere around the globe.
“All we request from the government is to create that enabling environment for the business to thrive; since it is obvious that the present policies of the state remain totally unfriendly to the business,’ he stated.
But as glaring as the issues facing the industry are, how receptive are the practitioners to the M&Q option? How ready and willing are chief executives of the not-so-thriving outdoor ad firms in the country, to relinquish their exalted positions and retire into oblivion?
“The fact remains that the idea remains alien here, especially in our advertising industry, but it is the way to go. This is the only way the sector can get the required recognition from the government, and it is in the best interest of operators in the business to give it a try,’ argued an outdoor ad practitioner, who would not want his name in print.
Curiously, Shobanjo and other proponents of M&A seem to be in the minority. Many practitioners still prefer to either sink or swim with the business alone. Perhaps, more adversities might change this line of thought in future, but for now the M&A question continues to linger.