The fourth quarter sees marketers and agencies busy putting together budgets for the next year. Marketers around the region are deciding how much they will spend - and agencies are trying to work out whether they’ll have more or less to play with than last year.
In recent weeks, of course, the global outlook has become very much more gloomy. ZenithOptimedia predicts a slowdown across the region from 6.6 per cent growth this year to 5.2 per cent. But which markets will be most affected?
In North Asia, Japan in particular is expected to suffer, with spend staying flat, according to John Goodman, president of Ogilvy & Mather Japan.
Greater China is more difficult to predict. “It will be a slow year,” says Ian Thubron, executive vice-president and CEO of TBWA Hong Kong. “But I don’t think the cuts will be as deep here as elsewhere. We are not likely to see budgets collapse, because business here is fundamentally robust.”
He points out that many global clients will be looking for greater delivery from developing markets to make up for slower sales in the West. Next year also marks the 60th anniversary of the founding of the People’s Republic, and the approach of the World Expo in Shanghai in 2010. “We see growth overall in China to be stronger than other markets,” says Publicis’ CEO for Asia, Matthew Godfrey.
Steven Chang, CEO of Optimedia in Shanghai, sees beverages and retail as major growth areas in China, with retail banking and credit services showing potential, though he predicts a slowdown in China’s property and auto sectors.
Digital is likely to benefit. Mark Cripps, regional digital director at McCann Worldgroup, says several campaigns will run early next year following a quiet end to 2008. That shift in budgets is likely to be replicated across the region - though Chang insists TV will remain the primary medium in China.
In Southeast Asia, Thailand and Malaysia are likely to see significant slowdowns, as global issues add to internal political problems. Preeyada Vuttipakdee, CEO of ZenithOptimedia Thailand, says that the country will see a growth in adspend next year driven primarily by inflation. She also estimates spend increasing on television and shrinking on print, and that real estate, cars and audio/video will see the sharpest decline in growth.
Prashant Kumar, CEO of Universal McCann Malaysia, feels that newspapers could gain prominence in Malaysia and agencies might need to focus on hard-working digital media such as search. The good news for Malaysia could come from the much talked about Iskandar development, which, if it takes off, could lift the economy.
The Singapore market, despite being closely aligned to the global economy, might escape the harsher impact due to Government investment and positive sentiment surrounding the upcoming Youth Olympics and development of integrated resorts. According to Gan Bon Guan, CEO of Starcom Singapore, the retail, automobile and financial sectors are more likely to cut budgets in 2009, and media such as print and radio will gain prominence over TV.
Next year, then, should see plenty of upheaval for agencies and clients. Although Asia as a whole should ride out the storm better than the West, the marketing industry seems to be taking nothing for granted.
