State out to make sure it gets value for €80m advertising spend
THE important role that marketing and advertising plays in the business world is a commercial given. But when it comes to the State and the many commercial and non-commercial entities that fall within its bailiwick, marketing and advertising is a deeply-embedded necessity.
With a large number of tentacles reaching into the entire social, cultural and economic fabric of Irish society — from Government departments, and semi-state bodies right down to local authorities and other regional bodies — marketing and advertising plays a key role in helping these organisations engage with the people they serve. This includes the new Strategic Communications Unit which will help them with their own internal media and marketing strategies and in some cases, help Ireland put its best foot forward on the international stage.
It might come as a surprise to some to learn that the State is also the biggest spender on marketing and advertising in Ireland by far.
Figuring out precisely how much the State spends on marketing and advertising, however, is fraught with all kinds of difficulties. But a good starting point is the Nielsen Addynamix platform ,which tracks advertising spend in Ireland across Facebook, neither of which disclose their Irish advertising sales.
This €51.95m, however, relates solely to money spent on advertising with Irish media companies and it does not include any creative, design or digital services from outside consultants. Nor does it include spending on public relations or other marketing-related services. And finally, it does not include advertising or marketing spend overseas by the likes of Tourism Ireland or Bord Bia.
If one was to include all of these, it is entirely conceivable that the full amount would be closer to €75m–€80m, if not more. But in the absence of more concrete information, let’s call this an educated guesstimate. Somewhat surprisingly, radio advertising accounted for the biggest chunk of this spend at €18.4m while TV took in around €13.4m, with press getting around €9.6m. The outdoor industry, meanwhile, accounted for €5.5m, according to the Nielsen figures while cinema weighed in with just over €1m. If Google and Facebook, which are not measured by Nielsen, were included, the amount spent on digital advertising could conceivably be as high as €10m.
But the role marketing and advertising plays the day-to-day operations of the State goes way beyond a 30-second slot on TV or a full-page ad in a newspaper. Some State agencies have marketing baked into their raison d’être.
The most obvious of these is Tourism Ireland, which invests around €32m promoting Ireland as a tourist destination overseas. Tourism, as we know, is an industry that reaches into every county of Ireland, accounting for almost 4pc of GNP and total revenues of €8.25bn in 2016. Likewise, Failte Ireland, which spends in the order of €8m a year, also plays an important role in marketing Ireland to us natives and helping companies become, well, better marketers.
Then, of course, there’s Bord Bia which spent nearly €34m of its 2015 budget of €56m on “promotion and marketing” — not just on the various schemes it operates — but also helping Irish companies get into new markets and building their own marketing capabilities.
And finally, let us not forget the trojan marketing work carried out by IDA Ireland which has been responsible for delivering substantial foreign direct investment to these shores in recent years. Its most recent annual report for 2016, for example, shows that it spent around €10m externally on marketing and advertising during the year, the bulk of which was overseas. Given IDA Ireland’s success in recent years — coupled with the fact that there are more than 200,000 people employed in companies it has backed — it’s fair to say that this is money well spent.
Whether or not every cent spent on marketing and advertising by the State and all its entities is money well spent will always be a topic of debate and some will be easier targets than others. But like many companies in the private sector in recent years, it too has been looking at extracting much greater efficiencies from its marketing and advertising budgets.
But then again, with as much as €80m at stake, that’s the way it should be. Contact John Mcgee at email@example.com