Media cash cow in 2018 revealed

NAIROBI, KENYA: Companies in Kenya spent Sh91.5b in 2018 down from Sh108 billion spent a year before in advertising expenses, a new survey by the Kenya Media Landscape (KML) released on Wednesday shows.

Review of advertising spends for 2018 and 2019 shows that the Betting and Gambling sector controls Kenya's advertising landscape.

The betting and gambling sector accounts for 22 per cent of the Sh91.5b spent on advertising in 2018.

According to the report, the gambling and betting high spend is driven by increased competition which is manifested by a proliferation of new players into the industry deemed to be very lucrative.

Top Companies Advertising Spends - Radio, TV & Print [Source, Reelforge]

Other sectors that spent billions to market their services and products include finance (14 per cent), Food (9 per cent), Communications (8 per cent) and Beverages (8 per cent).

Some of the 2018 top advert spenders include Tatua (5.36b), Safaricom Limited (4.97b), Lotto (4.59b), Pwani Oil Limited (4.21b) and East African Breweries Limited (3.51b).

For the first half of 2019, data by Reelforge shows Safaricom spent 9.71b in ad expenses, Shabiki 5.45b, Viusasa Sh4.49b, Government of Kenya Sh4.02b and Supa Five Sh2.80b while Sportpesa at 2.22 billion.

Red Flag

Advertising expenditure, which has been on the main decline in recent years, remains the primary source of revenue for media houses.

However, ad spends by betting and gambling companies are likely to slump in the coming years following the government’s move to regulate the sector.

Last week, the Betting and Licensing Control Board (BLCB) said it had deferred the renewal of licenses for 13 casinos, six lotteries and eight betting firms.

In May, the High Court revoked an order by the Board banning the outdoor and online advertisement of gambling.

“A declaration is issued declaring that the BCLB directive on April 30 banning outdoor advertising for gambling firms was null and void on grounds that it was tainted with illegality, irrationality, unreasonableness and procedural impropriety,” Justice John Mativo ruled.

Additionally, an increase in taxes on betting and gambling firms by the government would likely reduce the amount of money they spend on advertisements.

For the 2019/20 Financial Year Budget, National Treasury Cabinet Secretary Henry Rotich proposed a 10 per cent excise duty on betting for every amount staked.

According to a study done by GeoPoll in 2018, Kenya has the highest number of gambling youth in Sub-Saharan Africa (SSA) and sports betting has become the most popular form of gambling, on the rise of sports betting in the continent.

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