KATHMANDU, Jan 26: Advertising revenues went down by 30-40 percent in 2011/12 compared to the previous fiscal year, according to Advertising Association of Nepal (AAN).
Though the exact figure is yet to be calculated, sources at AAN said revenue has gone down drastically this year. Last year, total revenue was recorded at Rs 4.32 billion.
“Until last year, we were enjoying revenue growth of 10 to 15 percent. This year we will post negative growth,” said Bharat Lal Nyachhon, executive director of AAN.
Nyachhon attributed drop in revenue to unsatisfactory trading and manufacturing activities and mushrooming of media houses.
According to advertising agencies, drop in revenue is mainly due to unfavorable investment climate in the country, which discouraged fresh investment in the industrial sector; increase in the number of media houses, which is more than the market size; and reduction in marketing and promotion budget by big industrial and trading houses.
Most of the business houses are carrying out Below the Line (BTL) activities and promoting their businesses through social media which is comparatively cheaper yet more effective.
“Most of the real estate and automobile companies that spend huge amount of money on advertising have reduced their marketing and promotion budget. This is affecting our revenue,” Ujaya Shakya, managing director of Outreach Nepal, said.
Saying that many companies are focusing on BTL activities and using social media to promote their business, Shakya said advertising industry should explore these new avenues.
Besides, prolonged load-shedding is also affecting the advertising industry. Advertisement orders in major television stations have went down by 60 to 80 percent, according to AAN officials.
Santos Shrestha, general secretary of AAN and CEO of Mars Advertising, said the advertising industry has seen a sharp decline in revenue this year.
“The volume of advertisement has dropped by 30 to 40 percent mainly because of political instability which is discouraging fresh investment in trading and industrial sector,” he added. “We, however, are hopeful that advertisement industry will pick up once the political situation is stable.”
Advertising training from Feb 3
Advertising Association of Nepal (AAN) is organizing ´Professional Advertising Training and Job Placement Program´ from February 3.
According to Bharat Lal Nyachhon, executive director of AAN, the 15-day basic training will cover different aspects of advertising industry and media.
The training will see participation of 30 people. AAN has fixed application fee of Rs 500 for the training.
“We are hopeful that this kind of training will help people learn about various theoretical and practical aspects of the advertising industry which will help fulfill the manpower in the industry to some extent,” said Nyachhon.