Thailand has seen double-digit declines in media spending over the last two years following a military coup and periodic advertising blackouts imposed during the year-long mourning period for the late King Bhumibol Adulyadej. The industry now hopes an impending election this year may put some stability back into the industry.
Thailand has been under military rule since May 2014, when the army took power in a coup. The military government has indicated that an election will be held in November this year after a number of false starts and a constitutional change.
The death of King Bhumibol on 13 October 2016 exacerbated the preceeding flagging economy. Due to the immediate advertising restrictions after the king’s death, as well as during his cremation month in October 2017, there were only 11 working months in 2016 and 2017 in advertising. Charuvatana estimated that the overall media spending in Thailand declined by 6% to 8% in 2017, while media spending for the first half of 2017 fell by 11% according to figures from from the Media Agency Association of Thailand.
“It’s been a rough two years, from what we have seen from our key clients, they want to regain their positioning back,” said Charuvatana. “Taking the numbers from 2016 and 2017 into account, and multiplied by 12, we can expect an organic growth of 8% this year for the 12 full working months.”
Yupin Muntzing, CEO, McCann Worldgroup Thailand, concurred, saying that government stimulus programmes introduced to boost spending during the year-end holidays had yielded results. “Consumers are feeling more confident this year, after a lull period last year, and it is also important for us to give consumers the confidence,”said Muntzing.
Meanwhile, Charuvatana said the diversification of content and more cost-efficient strategies in recent years will give clients and their media partners a better deal. He agreed that TV remains the most important media, but he was confident that more ad spend will shift to mobile, even though spending in this category only constituted 7.3% of overall expenditures in 2017, according to figures from IAB.
“Mobile is essential as the vehicle for growth for Thailand, like most other APAC countries,” said Charuvatana. “For Facebook and even YouTube, we are usually allocating 50% for mobile,”said Charuvatana.
“TV still takes up the biggest share, but whether it is expensive or not, it depends. Currently the market is duopolised by Channel 2 and Channel 7, but now the focus is only on primetime drama and not on all other programmes like before,” said Charuvatana. Thailand currently has 22 TV stations, but Charuvatana said only the top 10 stations are doing well. The Nation Multimedia Group, which owns Nation TV and digital TV channel Now26, posted a loss of 1.1 billion baht in 2016 and announced plans to sell off its assets recently.
What the Thailand market currently needs is a more mature and independent third-party measurement structure, Charuvatana said. Third-party checks are still not widespread in the country, occurring only on a client-by-client basis.
“It’s a bit tough, for a smaller market like Thailand, we can only afford one third-party vendor," Charuvatana said. The third-party vendor who is doing TV measurements should also be thinking about multiscreen. On the other hand, we are also tracking with our OOH partners because we don’t only deal with media inventories but other data inventories, that’s probably the other route to learn about what works well with our consumers.”
Nielsen Thailand and WPP-owned OOH media planner company Kinetic Thailand both saw healthy prospects for OOH in Thailand where consumers reportedly spend 10 to 12 hours outdoor. According to Nielsen Thailand, OOH media spending increased in all channels for the first half of 2017 where spending in in-store ads, transit ads and outdoor media (billboards and buildings) increased by 38.1%, 26.8% and 16.3%, respectively.