Global media agency giants grow more influence in Nigerian market

Nigerian media agencies who are presently struggling for survival over consequencies of economic recession are facing another round of business difficulty on account of global media business realignment.

As a media analyst puts it, big global agencies are really having massive influence and control  over Nigeria’s media operations as they determine who gets multinational businesses in the Nigerian market and other emerging economies on account of global realignment.

They are using these affiliations and realignements to understudy Nigeria and take briefs and where they don’t have affiliations, they hire, says the analyst. Nigeria, the biggest market in Africa is, has a big  growth opportunity globally for multinationals.

“The media business accounts change hands in the local market the moment the multinational companies who have deep purse for marketing communication transact business with another agency globally and this has effect in Nigeria as the affiliate agencies subsequently get the business without pitch”, the analyst said.

Presently, it is only those Nigerian agencies that have retionship with the global giant agencies that get the juicier accounts while many others struggle to gain accounts of few local companies some of whom don’t have deep advertising budget or don’t advertise at all.

According to the analyst, the big global agencies also determine and control the business budget for the local affiliates from abroad. “If they suspect that they would find it difficult to repatriate funds after jobs have been executed in the local market, they decide  the amount to give the local agencies for jobs”. The wide-dollar disparity and scarcity of foreign exchange have made repatriation of funds not easy.

The world class agencies are tactically using this realignment strategey to take accounts from Nigerian agencies who are helpless even in the face of APCON reform of 2013.

In January this year, MTN, for instance appointed Omnicom Group to replace WPP as its integrated global agency. Six global agency networks — Dentsu Aegis Network, Havas, Interpublic Group, Omnicom, Publicis and incumbent WPP (through MetropolitanRepublic and Aqua) — were invited to tender for the account in March 2016. Three (Omnicom, Publicis and WPP) continued into a second round late last year.

Omnicom was later selected based on having met “the functional and commercial requirements” of the pitch, according to MTN. These requirements were scope of work and specialisation, industry and geographic track record, proposed resource (footprint, team and transformation agenda), and specified risk and financial parameters”.

Practically, under the global realignment arrangement, all agencies affiliated to WPP in the Nigerian market handling MTN are therefore out mid this year when the contract takes effect while agencies affiliated to Omnicom would take over the jobs.

With global affiliation and realignment trend, global agency giants who want to operate in the big Nigerian market and Nigerian media firms are equally in search of best-of-breed partnerships.   Last year, some agencies signed affiliations with foreign agencies as part of growth and expansion strategy. Publicis Groupe, the world’s second largest advertising conglomerate with strong foothold in Europe, Asia and America, sealed up a 25% stake in Troyka Holdings, Nigeria’s largest advertising group. According Biodun Shobanjo, the Group Chairman of the company,  the decision to partner with Publicis was largely  value-driven. Publicis was formerly represented in Nigeria by Rosabel Leo Bunnet and Starcom Media.

Also, Chain Reactions Nigeria, one of Nigeria’s most vibrant PR firms signed with Edelman, a foremost global communications marketing firm based in South Africa. Dentsu Aegis Network Sub Saharan Africa, one of the leading global advertising networks, signed affiliation with  Noah’s Ark Communications Limited, one of Nigeria’s leading creative agencies, as its affiliate creative agency in Nigerian market.

Tomorrow, Centrespread, one of Nigeria’s top class agencies is expected to announce its partnership deal with Grey Group,  a global advertising and marketing agency with headquarters in New York City, and 432 offices in 96 countries, operating in 154 cities.

More partnerships are expected as foreign and local agencies search for relationships underscored by business interest.

Daniel Obi

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