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Naked billboards tell the graphic story of firms struggling to make ends meet

By Peter Theuri | June 21st 2020 at 12:00:00 GMT +0300

Paint peeling off the walls of some of Nairobi’s most eminent landmark buildings is the last thing anyone sauntering down the city streets would notice at the first glance.

But a double take by many keen observers is likely to reveal this and much more. Gone are the many billboards featuring eye-catching advertisements that usually adorn the otherwise drab-looking facades.

The same goes for many other billboards on some of the city’s streets and major roads. 

This as companies adapt to the new normal of budget cuts that has seen them put advertising campaigns in the back burner in the wake of the coronavirus pandemic.

According to Job Ndubi, managing director at Elegance Technology Ltd - a digital printing and signage solution and software company - business has never been worse for billboard printers, dipping by about 90 per cent in a few short months.

“We are now doing in a month what we used to do in a day,” says Mr Ndubi.

Earnings from billboards and advertising is one of Nairobi County’s key revenue streams that have now dried up. The county recently reviewed its fees to enhance compliance, expand the bracket of payers and tightening management controls for more efficient collection and accountability.

There are about eight main outdoor advertising companies in the country that control nearly all the billboards around the city.

These are Magnate, Adsite, Firmbridge, Live Ad, A1, Think Outdoor, Lookmedia, Tangerine Investments and Transad.

But they are now feeling the heat of muffled business. Patrick Wameyo, a financial literacy educator and small business consultant, says the hiatus by firms from billboard advertising might be ushering the world into a future that will be devoid of them.

Despite billboards being some of the most affordable forms of advertising with operators charging between Sh150,000 and Sh200,000 a month, depending on location, size and demand, they still boast distinct advantages over other advertising media. They are, for instance, visible and noticeable to onlookers and travellers due to their size.

They also do not disappear as fast as they arrive unlike ads on TV and most social media sites. Companies that have traditionally relied on this form of advertising are on the back foot as they try to save resources following the outbreak of the novel virus just over three months ago in the country.

“Businesses have to survive before they can thrive,” says Wameyo, noting that companies have to cut on variable costs when the going gets tough.

He says some of the leading companies that routinely buy space on billboards in the most prime locations in the city are now opting out of contracts as the health crisis prompted by the pandemic morphs into a full-blown financial crisis.

“When the times are tough, businesses have to lower costs that can be cut without killing them,” says Wameyo.

Covid-19 is sweeping through the corporate world, forcing some firms into mass layoffs while dealing a mortal blow to others that might never recover.  According to Wameyo, competition for prime space in urban centres was until recently at an all-time high, fuelling competition among ad firms. 

This meant bookings were always done well in advance, contracts renewed promptly, while rates kept on going up steadily until Covid-19 struck.

“Companies have been looking to advertise in billboards that are in prime locations, especially at major junctions and roundabouts and in high-traffic areas. Companies announcing launches want to secure billboards in locations where they would have the biggest reach, and this cutthroat competition leads to the billboards becoming increasingly expensive,” Wameyo notes.

Winnie Kimeres, a business executive at Think Outdoor, however, says that billboard advertising is cheap and a wonderful avenue through which new and rebranded products can be advertised.

“Companies pay, say, Sh140,000 to have their adverts on a billboard for a whole month. That is very manageable. Campaigns and products in the first phase of launch do very well on billboards. Companies prefer that customers see the products on billboards before adverts from other less visible or attractive platforms kick in,” says Ms Kimeres.

“By that time, the customers are already aware of the products.”  Restriction in the movement of people through the night-time curfew and partial lockdowns as one of the ways of curbing the spread of the virus means the allure of billboards has waned for firms.

It is a no-brainer that companies would splash money on billboards, while the people expected to be seeing them are locked up at home.

Some are stuck at home because their employers have sent them on unpaid leave, with their companies, which should be the advertisers, staring at bankruptcy. And things can only get worse for ad firms, with the growing uncertainty over when the virus might be contained both locally and globally. 

According to Elegance Technology’s Ndubi, people’s spending power has plummeted, and many urban dwellers have retreated to rural areas, making the reach of billboards way less than it was before Covid-19.

Fortunes have been dwindling since the last general elections, but 2020 has struck a deadly blow to outdoor advertising.

A recent survey by Ajua, formerly mSurvey, revealed that people are glued to the screens of their smartphones and barely take a keen interest in checking out billboards.

Over 39 per cent of the total respondents picked from all age groups and locations around Nairobi said they “often” look up at billboards, with 32.2 per cent always careful to study them and digest their contents.

While the popularity of billboards remains at 11.1 per cent compared with social media ads and websites (40.3 per cent) and TV (37.5 per cent), about  35.1 per cent of the respondents, however, claimed billboard advertisement influences their choice of a product in the market.

Only 11.4 per cent of the people barely paid attention to the adverts on billboards in terms of subscribing to advertised products. The pictures put on a billboard, wording of the billboard, physical location, dominant colour and size of the billboard, in that decreasing order, attracted customers’ attention.

Only six per cent of the total respondent claimed to have zero interest in billboards, never looking up to see what advertisers are up to.

“Ajua’s technology integrates with businesses at the points that matter most to their customers to measure and optimise their customer experience,” said Leonida Kombo, senior associate, corporate engagement and learning at Ajua.

Despite the waning fortunes of the sub-sector, billboards’ colour, attractiveness, size and location mean they cannot entirely be replaced. Companies that are still keen to advertise on billboards are now trying to negotiate with advertising agencies for a free extension of their contracts, a situation Ndubi says is catch-22.

Billboard owners are torn between considering their clients’ pleas for mercy and pulling down the adverts.

The consensus is that companies should now turn to digital advertising. With the use of social media unquestionably becoming the trend, companies have leveraged various platforms to pass their messages to customers.

It is a paradigm shift that has been hastened by Covid-19. According to Wameyo, this shift may end up being the last nail on the coffin for billboards.

“Social media cuts across age and social class barriers. As such, companies can spread their messages and reach as many clients as possible at any given time,” he says.

But Kimeres reckons that due to the unique nature of some products, billboard advertising still has a lifeline.

Ndubi is also optimistic that when the pandemic finally passes, billboards will still play a crucial role in advertising.  Competition form other platforms is, however, bound to put pressure on sector players.

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