Top 10 performers in Lebanon & the Arab world
Nobody can argue that 2017 wasn’t one of the most difficult years on the media industry, and specifically advertising, if not the most difficult. If 2008 was a year of crisis, then 2017 is the year of the big crisis. With so many events marking the year, mainly geopolitical ones, media expenditures in the region were badly affected, and despite the fact that we measure advertising expenditures based on the rate cards, which we all know are highly inflated, advertising expenditures even on rate cards witnessed a drop. This is the first time that we have seen that, because usually the media tend to increase their prices on rate cards year-on-year, while giving more and more discounts in reality.
One of the most difficult tasks is measuring total advertising expenditures, and specifically in MENA, not only is the technology too complicated to do that, but the major problem is giving value to air time, especially since the competition between media is mainly based on prices. This is why the gap between what they officially price on their rate cards and what they actually sell is huge, and there is no hope in the near future for a certain miracle or something that might happen to inspire the major players to start respecting their rate cards, like in any civilized part of the world.
On a separate note, we at Ipsos have taken many measures in 2017 to start reducing the gap between the rate cards and the real selling prices. I believe that those measures have contributed to this drop in official rate cards; otherwise we might have even seen a ridiculous increase in total spending based on rate cards.
So, in times of crisis, the easiest decision is for companies to cut their expenses, and the first victim would be advertising expenditures. Add to that the price war and competition between the media themselves. Advertisers are benefiting from that, and getting more advertising space for less than
the amount that they used to pay. In all, what is happening is that the advertiser is the one who is benefiting the most. Not only are they cutting their budgets, but in many cases if not most they are also getting more advertising space, or at least the same for less the money. Adding to that also is the shift happening between offline to online media, which is considerably cheaper than offline. This is all leading to the fact that the golden days for offline media, especially print, are over.
The total advertising expenditures for traditional media, excluding online, witnessed a drop from around 22 billion USD in 2016 to 20.3 billion USD in 2017, a fall of around 7%. Most markets have witnessed a drop, with a few exceptions like Egypt and Iraq. The media that was most highly affected and witnessed the highest drop was print, with a drop of 27% year-on-year. TV declined by 7%, while outdoor grew by 4%. Radio dropped by 1% while cinema by 5%.
Looking at 2017, and specifically at the share of expenditures by media, the lion’s share still goes to television with 78% of total expenditures, followed by print with 10.2%, outdoor with 7.3%, radio with 4% and cinema with 0.4%. Looking at the numbers by market, the biggest market is still the Pan Arab market, with 36% of the total expenditures in MENA, followed by Egypt with 28%. UAE comes in 3rd place with 9%, Lebanon fourth with 8%, KSA (only local media) with 5%, then Kuwait in 6th place, followed by the Pan Asia market, then the rest of the countries.
Looking at the numbers by categories, telecommunications comes first, followed by banking in 2nd place, cars in 3rd place, real estate in 4th and washing detergents in 5th, while if we look at the numbers by brands, Saudi Telecom is the number one brand in MENA, followed by Dettol in 2nd place, Samsung in 3rd place, Vodafone in 4th and Etisalat in 5th. Three out of the top five Brands in MENA are telco companies.
The number one media agency in the region in terms of volume of media buying in 2017 was Starcom Media Vest Group, followed by Universal media, Magna in 3rd place, MEC in 4th place and OMD in 5th.
Regarding the Online monitoring expenditures, which is something new that we have added to our data, the total expenditures in 2017 were 738 million USD. This number includes Facebook and Google ads, which shows that the share between Facebook and Google is 76% to Facebook and 24% to Google in our region, and 11% of the total online ads in our region are programmatic, while 89% are direct ads. Looking at the online expenditures by device, they differ from one market to another, but in total MENA it is split equally between mobile and desktop. Looking at the numbers by category for the online expenditures, the cars category is leading in first place, followed by banking in 2nd place, telecommunications comes 3rd, real estate in 4th position and restaurants in 5th. As for the brands’ ranking online, the top brand is Samsung, followed by Nissan in 2nd place, Chanel in 3rd place, Quaker in 4th place and Mcdonald’s in 5th. As for the top online agencies, Starcom Media Vest Group is 1st, followed by OMD; MEC is 3rd, Mindshare is 4th and Havas is in 5th place.
A small word about 2018, which in my opinion will be very similar to 2017 in terms of trends. The only solution for the industry to get back on its feet is by joining hands and injecting some transparency and competing in a fair way.
The following tables will show total advertising in the MENA region by different groups, country by country, all prepared by the Ipsos team. Enjoy the read.