Racheal Lee
May 31, 2013

Brands, agencies applaud HCMC's move to allow public-bus advertising

HO CHI MINH CITY - A move to lift the advertising ban on public buses in Ho Chi Minh City has been welcomed by agencies and brands, even though the first ads won't appear until 2015.

Brands, agencies applaud HCMC's move to allow public-bus advertising

Michel Borelli, managing director at Lowe Vietnam, noted that winning the visibility battle is the key for marketers in an utterly cluttered retail market such as Vietnam.

“With more bikes on the road than there are people in the country, outdoor––and particularly public transport/mobile––advertising is destined to keep growing,” he said.

Lam Le, managing director at MediaCom Vietnam, concurred, adding that bus advertising is only banned in Ho Chi Minh City. Effective since 2002, the ban prohibits advertisements from appearing in public, including on modes of transport such as buses, trains and taxis.

“The results showed a positive demand for this channel,” Lam said. “Vietnam traffic consists mainly of motorbikes, and our media habit research also shows that out-of home, including buses, is one of the top channels with high views.”

Earlier, Saigon Times online newspaper quoted director of the Public Transport Management Centre Le Hai Phong as saying that the city could earn US$4.78 million a year by allowing billboards on its fleet of more than 3,000 buses. The city, it added, plans to increase the number of buses to 3,500 by 2020 to serve 16 per cent of demand, up from the existing 10 per cent.

The local government in Ho Chi Minh City is said to be allowing buses to carry ads by 2015, following the passage of the new advertising law by the national assembly at the end of last year.

However, the industry is waiting for the details of the new law: “We are yet to know what this would mean by allowing advertising on buses in HCMC because other cities like Hanoi, Can Tho Da Nang do not have such a ban,” said a local industry insider.

The executive continued that the industry doesn’t expect the new plan to reinstate advertising on public transport to be underway at least until 2015, and that there is “a lot that needs to happen before there is any proper progress”.

“Public transport advertising is an integral part of our OOH advertising and both brands and agencies are in favour of them,” this source said. “As per adex figures, brands allocate about 5 per cent of their ad dollars to OOH. Our research shows that some of the beverage brands like Coca-Cola and Pepsi have higher awareness [on OOH]––as much as 30 per cent. We therefore believe it is a strong and strategic medium for advertisers.”

Even though Vietnam is traditionally a strong TV advertisement market, Lam noted that the advertising landscape in the country is becoming more fragmented with high growth in digital, cable TV and mobile.

“I think advertisers and agencies have been waiting for the lift [of the ban] as it opens up another good channel in the market,” Lam said.

The industry source, meanwhile, said that the dominant media in Vietnam is still TV and that the current estimated outdoor advertising spend is only about 5 per cent of total adex.

“However, you must bear in mind that this move will only impact HCMC as all other cities have a fuller mix of OOH advertising,” the executive said. “At the same time, HCMC is a significant market for advertisers and the lift of the ban will be welcomed by most.”

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