By Goddie Ofose Senior Correspondent
Over regulation of the outdoor advertising in Nigeria may collapse the business, Babatunde Adedoyin, the president of Outdoor Advertising Agencies of Nigeria (OAAN), warns.
Since the advent of Lagos State Signage and Advertisement Agency (LASAA), outdoor advertising has received intense scrutiny in the state. Other states have introduced their own agencies.
So far, OAAN is the most regulated in the integrated marketing communication (IMC) sector.
Most times, the government uses environmental cleanliness as a reason for regulation. But this usually ended up with an upward review of operators’ rates.
Indiscriminate hike in advertising rates by these agencies is the strongest reason operators believe clients are moving to other media, which they consider more affordable but not necessarily efficient.
In the past three months, the number of vacant billboards across the country has increased by 30 per cent. Over a million billboards are said to be vacant with clients failing to renew contract as a result of huge rates regimes.
Industry in first quarter
Adedoyin said: “It won’t be out of place to say that the economy is in total recession and in a situation like this, there is no way it would not affect our industry.”
He lamented the rate at which clients are slicing outdoor advertising budgets, a trend caused by two factors – harsh economic environment and regulatory bottleneck.
“The first quarter was very difficult. Clients are cutting budgets. Some clients are not sure what they want to do this year and some can’t even access foreign exchange to bring in raw materials.
“Since they do not have raw materials, they can’t produce, hence they can’t advertise. But we are hoping that next quarter would be better,” Adedoyin added.
Regulatory challenges
Adedoyin disclosed that the relationship between the regulator and operators is near zero apart from a few states like Cross River, Oyo and Enugu where those at the helm of affairs in agencies are operators.
“Unfortunately, the regulators are looking for money; they will tell you it is all about environment but not in all cases,” he said.
“Primarily, it is about money for them and that is why now that they are not getting much money from the centre, their governors and finance department are looking inward and they are putting more pressure not only on our members but other industry.”
He lamented that LASAA is trying to collect money at all costs and everybody is looking for ways to get money from operators because allocation coming from the centre is not adequate.
Advert rate
Operators have bemoaned the rate reviews by agencies, particularly charges on vacant billboards, which apply in Lagos, Kaduna, Kano and other states.
According to them, in less than a decade the rate has gone up by over 1,000 per cent and this is a major factor that necessitates brands movement to other media.
“All of us are old enough to know what was charged in those days before the advent of LASAA. LASAA came and the rate was hiked by over 1,000 per cent,” Adedoyin added.
“The regulators want to make money but as we keep telling them, Nigeria has oil but we don’t have anywhere to sell.
“Today, the Lagos State government does not receive federal allocation as it got some few years ago because revenue is no longer the same and it can’t besiege the federal government on that.
“But in our industry, regulators insist on getting what they used to receive when business was good.
“We are telling them to allow us pay to the extent that we have also received and they are not reasoning. We must get them to understand that.
“If the state government can take what has been received by the federal government, then they should also allow us to pay what we have also received.”
Debt owed by political campaigns
More than 70 outdoor advertising companies contracted to handle the campaign billboards of President Muhammadu Buhari and Governor Akinwunmi Ambode in Lagos are still waiting to be paid by the All Progressive Congress (APC).
“The companies that ensured that Buhari and Ambode billboards took over 95 per cent of the available billboards in Lagos have not been paid up to 5 per cent of their fees,” some practitioners lamented.
One senior executive committee members of OAAN, who spoke on the condition of anonymity, said they were invited by the former LASAA Managing Director (MD), George Noah, to do the jobs but only one or two who insisted on being paid were partly paid.
More than 70 companies remain in limbo.
One practitioner recounted that “the new LASAA MD, Mobolaji Sanusi, has refused to honour the agreement between us and his predecessor, yet his men have been clamping down on our members since around October last year, shutting down our billboards for non-payment of their own dues.
“He has also sent new bills for the year while the billboards are not working since he shut them down.
“We have explained that the APC billboard monies have not been paid to us by Noah who he claimed has been paid by the Lagos APC.”
Adedoyin disclosed that “our association has met with Noah but he is insisting that the APC is yet to pay him.
“All he keeps saying is that he is still talking to his principal but all we are asking for is payment for jobs we did.”
A chief executive officer of an affected company added: “We hesitated to come out till now because we didn’t want to embarrass the government or the APC but we were advised by Sanusi to go after Noah and the company he used to issue the media order, Media Worth.”
Sanusi insisted that OAAN members owe LASAA over N40 million but Adedoyin countered that the debt could be as a result of charges on vacant boards.