Investment in terrestrial TV advertising slumped from almost US$200 million last January and February to $80 million for the same period this year. Radio advertising, meanwhile, fell from $26 million to $7 million; newspaper advertising from $393 million to $152 million; and magazine advertising from $33 million to $13 million.
Steve Yi, strategic planning director at Grey Korea, noted that the decline had been more pronounced than the 10 to 15 per cent predicted by Kobaco, the Korean broadcast advertising regulatory body, at the end of last year. But Yi added that advertisers were tipped to increase spend from April, having cut back dramatically at the onset of the downturn as part of a “hold and see” policy.
The economic conditions have hit many domestic agencies hard. Korad, which is jointly owned by Daewoo, General Motors and Ogilvy, is understood to be looking for a buyer following cuts to GM Daewoo’s marketing budget. The agency is understood to have downsized from a staff of 120 to below 80.
Meanwhile, Oricom, which services struggling chaebol Doosan has reportedly scaled back by 30 per cent, as has Hakuhodo Cheil. Meanwhile, Phoenix Ad is reportedly planning staff reductions of up to 50 per cent, having recently lost the remainder of its key Samsung account.
