Investor
Relations

News

Newspapers back in No.1 spot with advertisers - Aug 30, 2005 (ST)

BackAug 30, 2005

The Straits Times / The Business Times News On SPH

Newspapers back in No.1 spot with advertisers



By Kelvin Wong
Aug 30, 2005
The Straits Times

THE newspaper has reclaimed its top spot as the medium of choice for advertisers in Singapore after television advertising took a hit from the closure of Channel i, according to the latest industry report by Nielsen Media Research (NMR).

Gross expenditure on newspaper advertisements was $353.1 million in the first half of the year, giving it 39.6 per cent of the ad market, a nose in front of television's 39.1 per cent.

Compared to the same period last year, newspapers gained 2.9 percentage points in market share, despite the withdrawal of one paper, Streats, from the market, while TV slipped 4.8 percentage points.

Ms Rebecca Tan, the executive director of NMR Singapore, said newspapers have traditionally dominated the ad market. The Straits Times, the flagship newspaper of Singapore Press Holdings (SPH), takes the bulk.

The past two years were an exception: TV snared 44 per cent of advertising dollars, and newspapers, 36 per cent last year. In 2003, it was 41 per cent and 39 per cent respectively.

But newspapers bounced back this year as gross expenditure on TV advertisements fell 18 per cent to $348.7 million for the first six months.

Total ad spending, including other forms of media such as radio and magazines, fell 8 per cent to $891 million.

This was largely due to the 'sharp drop in TV advertising resulting from the cessation of SPH MediaWorks and closure of Channel i, effectively leaving fewer station choices for advertisers', said Ms Tan.

Companies in the entertainment sector, such as music distributors and record labels, cut TV ad spending significantly from $78.5 million to $60.8 million.

Cross-advertising, where media owners promote their own medium via various channels, also dipped to $4.9 million from $12.6 million.

Ad spending in non-traditional media recorded gains, with the cinema and poster segments growing 41.7 per cent and 11.6 per cent respectively. The two have a combined market share of just over 5 per cent.

NMR noted that 'despite the withdrawal of one newspaper title, Streats, gross newspaper advertising expenditure remains largely unchanged at $353 million'.

Advertising agencies contacted yesterday agreed that their clients continued to use newspapers as a key medium for reaching out to consumers, while moving away from TV.

Ms Carolyn Kan, the managing director of M&C Saatchi, said: 'We've definitely seen a drop in TV, but print spending has held firm so the findings are consistent.'

One of its clients, online travel agent Zuji, does not advertise on TV, but uses a mix of newspaper ads and new media channels such as the Internet. It has previously tied up with SPH's AsiaOne portal.

Ms Linda Locke, the regional creative director of Leo Burnett Asia Pacific, noted that the shift away from TV advertising to other forms of marketing was a global trend.

Newspapers have one clear advantage over TV: the element of immediacy for a firm looking for an edge.

Said Ms Locke: 'Say you're a supermarket chain watching how others price their products. You literally have till the last minute to put your prices on the ad before going to print.

'With TV, it takes time to react, produce the ad and get it to air.'

Advertisers make the same point.

SingTel's vice-president of corporate brand marketing, Ms Mabel Tay, agreed that newspapers ads had a 'tactical' edge and were also less expensive.

'The entry cost for TV ads is much higher. The cost of producing a TV commercial here is one of the highest in Asia. So in order to get more bang for the buck, you'll see advertisers channelling more money to print.'

SingTel ranked within the top 10 advertisers in terms of ad spending. The others included Nokia, Sony and Courts, with M1 and StarHub sharing the No. 1 position at $12.6 million each.