Advertising agencies go online

by Macharia Kamau

Advertising agencies are gearing up for good times after months of cutting back on budgets. Players however say, to break even, they need to shift their advertising media and clientele.

Advertisers might still pursue cost-effective advertising solutions, given that they have been tested and worked during the lean economic times.

The agencies are also casting their nets wider to bring more clients on board and increase revenue sources, after seeing reduced activities in the last year among the traditional clients. Companies are estimated to have cut advertising spend by five to 10 per cent over the last year.

Low budget ad

Mr Jay Varia managing director of TDF Advertising said with advertisers looking for inexpensive means to get their messages across, there is need to develop products that capture small and medium sized businesses to increase the industry’s client base.

Mr Jay Varia MD TDF Advertising

This segment has in the past not formed an important section for the industry given their budget sizes.

But Varia notes that by reaching out to them, the industry would have an expanded client base and increased revenue.Varia noted that locally, advertising is an expensive undertaking.

"Medium-sized companies may not afford developing their advertisements locally large players can but other companies are finding it extremely difficult in getting their businesses noticed. But that does not mean they do not need to be visible or get noticed in the market place," he said.

He attributed this to misconception that most advertisers are large corporations.

"The local advertising industry needs to evolve, it is stereotypical and agencies are still using the old techniques that are of little of no value for their clients today."

Online based marketing using the Internet and the mobile phone is among the media that local advertisers might start warming up to given that they are both targeted and analysts say affordable.

In addition to online media, the company is looking at employing visual merchandising and branding display windows .

"These are among the inexpensive media that have not been utilised, yet they have potential to grow brands,"he said.

The industry has in the recent past witnessed increased activities, with different players positioning themselves with what are believed to be better solutions, mostly online-based media.

Cost effective media

Recent developments demonstrating optimism and a shift in the industry to more cost effective media include the launch of Squad Digital last week by Scan Group, which will be an online marketing agency.

Scan Group Chief Executive Bharat Thakrar expects a shift in the industry that has in the past relied on the traditional advertising media, especially with the undersea fibre optic cable that is expected to transform the local information and communication technology sector.

"There’s been a lot of hype around the arrival of undersea fibre optic cables, but the reality from our perspective is that we are seeing a step-change in the marketing landscape as consumers interact and engage with brands on mobile and web platforms," said Thakrar.

The shift to online advertising is gaining momentum with and as other than then agencies developing solutions for advertisers, there are emerging entities that act as commercial agents for online media. Among them is Infinite Communications, an online marketing company.

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