Where is life-support for media agencies before economy bounces back?
In spite of little signs that Nigerian economy would exit recession soon, the World Bank and the Buhari administration have assured that Nigeria will get out of present economic difficulty in 2017.
But before the expected economy’s bounce-back, where is the life line, especially for the marketing communication industry which is presently going through excruciating times. An analyst simply said that “these are challenging times for agencies” as businesses hardly come and available clients are either owing for months on executed jobs or demanding more on little budget. Other clients are developing some of their communication jobs internally. In fact, it is not easy for media agencies, he said.
John Ehiguese, the CEO of Media Craft, a top PR firm based in Lagos believed that things will get worse before they get better. He said the life support in the meantime is for agencies to continue to employ the surviving strategy of 2016 in 2017. “Those who survived 2016 can survive 2017”, he told BusinessDay.
Ehiguese had earlier said most agencies survived the tough 2016 through reduction in their expenses and adjusting cost profile. According to him, some agencies retrenched to stay afloat.
Another operator in the PR industry, Oluwasola Obagbemi, Deputy Chief Operating Officer, Red Media Africa had in a recent discussion acknowledged to BusinessDay inquiry that 2016 was indeed a tough year for media agencies in Nigeria
She attributed this to slash marketing budgets by sometimes over 50 per cent with agencies required to achieve same results/target but with so little.
Oluwasola believed that agencies that must survive this year must be resilient and innovative.
Also looking at surviving strategy in the industry, Odion Aleobua, CEO of Odion Communication who is optimistic of business recovery this year, warned that consulting firms who are able to provide integrated marketing communications with strong engagement tactics on the digital and traditional platform will excel in 2017 despite the current economic realities.
“The PR Agencies who can craft compelling narratives for their clients and creatively use other platforms to amplify messages will be at an advantage”, Odion told BusinessDay.
It is not sure whether the industry players are considering mergers and acquisitions as a possible option to hedge closure.
Biodun Shobanjo, the chairman of Troyka group had recently suggested mergers and acquisition as a rescue mission for the Outdoor industry in this difficult time.
He specifically told the operators in the industry to form bigger firms by merging in order to withstand the storm. “When an entrepreneur owns two billboards, he or she probably feels that it is good for him or her. Imagine if 10 of such people were to merge. They therefore do not need 10 CEOs. Some of them can go and do something else while they get their dividend every year”, he advised.