Ad spending projected to increase by 30%
Ad spending projected to increase by 30%
JAKARTA (JP): Advertisement spending in 2001 is predicted to
increase by 30 percent to Rp 9 trillion (about US$967 million)
from an estimated Rp 6.9 trillion this year, fueled by higher
consumer spending and a nascent economic recovery, according to
the Association of Indonesian Advertising Agencies (P3I) on
Tuesday.
P3I chairman RTS Masli cited Indonesia's vast population
combined with improvements in consumer confidence and the
country's economy as the main reasons behind the optimism.
"During the crisis, most firms curtailed their promotion
spending. But once they began to advertise again, they went all-
out to maintain their market shares," Masli said during a break
in a seminar on the prospects of Indonesia's advertisement
industry.
Noted speakers Sjahrir, the president of PT Syahrir
Securities, and Sri Adiningsih, a senior lecturer at Yogyakarta's
Gadjah Mada University, also addressed the seminar, which was
held by The Jakarta Post.
Masli said that consumer products, such as personal care
products like soaps, shampoos and cosmetics, were the highest
ranking in advertisement spending.
However, he said, some firms were still holding back their
promotions, such as real estate companies which had yet to see
their market recover.
Data from P3I shows that in 1999 advertisement spending rose
by 49 percent to Rp 5.61 trillion from Rp 3.75 trillion in 1998.
According to P3I, television still ranks first in absorbing
advertisement expenditure, followed by newspaper and outdoor
advertisements.
The association estimated that this year television
advertisements would grow to Rp 4.20 trillion from an estimated
Rp 3.44 trillion last year, newspaper to Rp 1.8 trillion from Rp
1.4 trillion and outdoor advertising to Rp 309 billion from 269
billion.
It said in 1999, personal care products claimed the highest
spending for advertisement with a total of Rp 354 billion,
followed by food and beverages with Rp 251 billion, medicine with
Rp 357 billion, cigarettes with Rp 232 billion and household
products with Rp 74.45 billion.
A marketing executive at cellular phone operator PT Telkomsel,
Erik Meijer, said advertisement would remain an important tool in
tapping the growing mobile phone market.
"Because of the good prospective, there will be more
competitors. And the only way to face them is by placing more
advertisements," he said.
Furthermore, he said because of the complexity of today's
telecommunications products, much must be spent on advertising to
inform people.
Meijer said that while TV advertisements were more aimed at
creating a corporate image, printed media were more suitable in
keeping people abreast of the latest in telecommunication
products and services.
However, he said, that too many ads in one media had become a
problem for advertisers.
"There are some media that are so popular that they have
become too cluttered with advertisements," he said.
Meijer said that if half of a TV show's duration was spent on
commercials, Indonesians would watch less TV, thus reducing the
effectiveness of the promotion.
Advertisers felt this media advertisement clutter in late
1999, when the economy began to improve and firms felt more
confident to spent money on promotions, he explained.
Because of this advertisement clutter, he said, advertisers
are now harder to please when placing their commercials or
advertisements.
He said that they had to be more creative in packaging and
placing their commercials.
To stand out from their competitors, companies are also
willing to pay more in return for a more visible spot in a
media.(bkm)