An interesting article in the Guardian on Friday, reveals that local outdoor advisers in Nigeria are in troubled economic waters. The article focusses on Lagos State Outdoor advertising industry which without a doubt is the largest in Nigeria, Africa’s biggest economy.
The article outlines some of the major challenges the industry is facing not just in Lagos but in other parts of the country. We picked the following highlights from the article;
- The advertisers reveal Lagos State Governor Ambode and the APC is Owing them about N1 billion from adverts placed on outdoor billboards during the election season
- This was after former Managing Director the Lagos State Signage and Advertising Agency (LASAA) promised them that whatever cost was incurred by each “campaigner would be used to offset previous debts owed it.”
- When the new Managing Director at LASAA came in, he renegaded on the previous deal leaving advertising companies wallowing in debts.
- Despite the debt, the Lagos State Signage Agency is still demanding that advertisers pay outstanding levies owed the agency.
- Advertising practisioners complain that they can’t pay their levies to the signage agency because advertisers have cut their budget due to the economic situation in the country
- Business is now so bad that “LED billboards have just one or at most three adverts running, a break away from the past, when minimum of five adverts were run. Also, many of the static boards are empty, while some of the LED billboards are now operating as static billboards.”
Several other Mainstream media have reported this story at various times this year suggesting this might be an orchestrated campaign by the advertising companies to pile pressure on Lagos state to compel the party to pay the debts. Nevertheless, it appears the outdoor advertising business is undergoing what you can attribute as a severe recession. Nairametrics cannot immediately confirm if advertisers have cut down on fees or if there are exploring other business models that can help sustain revenues. For example, digital outdoor advertising could copy the model Google uses for adsense. With adsense small companies can buy advertising space and time based on their budget relying on bids rather than a fixed price. This ensures advertisers pay for what they need and at competitive prices and also ensures advertising companies get their billboards filled at all times.