Live Issue... MediaCorp makes play for outdoor advertising dollars

Last month, it opened an out-of-home media division and the new arm has scooped two high-profile launch clients.  It will manage advertising on digital screens for the newly opened ION Orchard and Orchard Central shopping malls. 

Outdoor advertising is seen as a major area for growth in Singapore as adspend for TV and print loses share. According to Nielsen, adspend for outdoor in Singapore was five per cent five years ago. Today, it commands 10 per cent of the ad expenditure pie.

The broadcaster is entering a market dominated by SPH MediaBoxOffice, Clear Channel, JCDecaux and Moove Media. Yet observers feel it stands a good chance of succeeding. 

Rajesh Mahtani, executive director, strategic solutions, at Starcom Singapore, says the local outdoor space is not crowded when compared to Hong Kong, Korea, Taiwan and Japan. Singapore “has the capacity to become a more vibrant outdoor market”, he adds.

There is more to the move than a simple desire to enter a growing sector. According to Pat Lim, managing director of PHD Singapore, MediaCorp’s latest venture is a “response to clients’ needs that are all about integration” and is also “an alignment to current demand”. As clients look for more joined-up solutions, media operators are eager to have the inventory to match.

This is in some ways MediaCorp’s second foray into outdoor TV after TV Mobile (television services on buses). MediaCorp appears to be focused on finding new opportunities to sell its expertise in video entertainment.

With TV, print and radio already under its belt, MediaCorp is now going after segments and audiences it has yet to reach, according to Kenneth Tsang, CEO of Universal McCann Singapore. Mahtani feels that while MediaCorp’s retail network is “not as established as SPH’s, this is an opportunity for it to become established in this space”. He adds: “Brands constantly need to create engagement, and malls are a good place to do that.”

The ION Orchard deal sees MediaCorp managing an LED screen that overlooks Singapore’s prime shopping district. It will also manage and supply content to over 100 smaller digital screens spread over the mall’s eight storeys. The deal is a coup; ION Orchard, the latest mall on Orchard Road, has garnered a lot of attention as the latest ‘it’ mall, with new retail concepts and flagship stores. Vikram Bansal, MD of ZenithOptimedia Singapore, believes this positioning marks a different strategy to SPH MediaBoxOffice, even though the latter already has deals with malls. “MediaCorp has taken up a more iconic space, which is suitable for high-profile luxury brands. So it does not compete directly with SPH.”

Bansal argues that mall-based advertising will continue to grow, and that established outdoor players should watch for new entrants. “JCDecaux and Clear Channel are not direct competitors. In fact they are complementary. There are still opportunities for more players.”

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This article was originally published in 13 August 2009 issue of Media.