Looking Towards a brighter future
JORDAN’S ADVERTISING INDUSTRY IS SUFFERING AS ITS ECONOMY STRUGGLES. WILL 2019 PROVIDE A GLIMMER OF HOPE?
Jordan is a country that’s relatively ignored by the wider advertising industry. Its economy is small, its natural resources sparse, its neighbours troublesome. Yet it is a stable and functional state that has made a name for itself as a regional tech capital.
Compared with other countries in the region, Jordan has promise. Technology, film and tourism have all been embraced over the course of the past few years, with Prime Minister Omar Razzaz recently launching a $98 million fund to support the country’s entrepreneurs. Further initiatives are expected as the government seeks to revive the country’s stalled start-up ecosystem.
The recovery of Jordan’s tourism sector is also underway, with revenues jumping 12.6 per cent to $4.5 billion during the first 10 months of the year, according to the nation’s central bank. Meanwhile, Netflix wrapped production of its first Arabic original series in Amman in late October, further cementing Jordan’s position as a filmmaker’s destination of choice.
That’s the good news. Now for the bad. Jordanians continue to face chronic poverty and high unemployment as the country’s economy suffers under the weight of a refugee crisis. Its economy remains in a low-growth scenario, according to the World Bank, with GDP expected to increase by 2.4 per cent in 2018. Unpopular austerity measures introduced to reduce record levels of public debt have also caused friction, while International Monetary Fundguided tax hikes have led to public showdowns with the government.
At the root of it all is uncertainty in Syria, the slow revival of economic cooperation with Iraq, economic slowdown in the GCC, and a soaring population. The knock on effect has been an increase in the cost of living, with the Economist Intelligence Unit ranking Amman as one of the most expensive cities in the Arab world.
“It’s been quite bad,” admits Ivan Milovanovic, managing director of Y&R Amman. “Jordan has a large budget deficit and the government introduced a series of taxes at the beginning of the year. These taxes made the private sector extremely conservative, unwilling to invest, and put many industries in a state of hibernation. Logically, communication, advertising or promotions were the first ones that took the hit.
“Such a situation has made agencies in Jordan less attractive for talent, making an already tough
recruitment situation even harder. There are many agencies that were not prepared for this. We decided to bite the bullet, invest, and hope the work speaks for itself.”
“Depression is definitely the current state,” adds Bassem Dajani, CEO and managing director of TBWA\ Jordan. “High unemployment figures, cash scarcity, higher taxes and probably the most important factor, reduction of foreign aid; all combined together have put not only the advertising industry but all other industries in a depressed mode.”
And yet Zenith’s expenditure forecasts for 2018 point towards an annual adspend increase of 5.6 per cent – a figure that flies in the face of much on-the-ground discussion. The media agency expects adspend to hit $95 million this year, increasing to $100 million in 2019.
“This year witnessed a severe recession leading to a huge reduction in advertising expenditure,” says Dajani. “More emphasis has been given to social media as opposed to above-the-line. Print advertising is at its lowest and this can be clearly seen in the daily newspapers and the TV stations that operate out of Jordan.
“Changes are inevitable, especially with the modern era of social media. Budgets for campaigns are being reduced and companies are relying on radio, outdoor and other digital and social media channels. Clearly the quality of work in those domains is improving. [And] as consumers turn to social media to convey their thoughts, many companies have the challenge of breaking away from conventional advertising methods and are relying on specialists in social media to develop their communication strategies.”
Adapting to reduced budgets is only one part of the problem. There are challenges of “differentiation, reinvention and expertise in digital” as well, says Rana Hamarneh, group executive director and partner at Adpro Communications. For media agencies, return on investment, clarity of metrics, digital expertise and the proper use of tools and data are of immediate concern.
Many of these challenges are not unique to Jordan. Agencies everywhere are struggling to reinvent themselves in the face of advertising’s continued global
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transformation, which has laid waste to well-intentioned business plans and made a mockery of agencies’ attempts to keep pace with technology and globalisation.
“I personally would like to think of the past year as an evolutionary and revolutionary year,” says Hamarneh. “Agencies had to adapt by changing their business model and integrating disciplines while pushing for newer technologies amongst many other things.
I personally would like to think of the past year as an evolutionary and revolutionary year. Agencies had to adapt by changing their business model and integrating disciplines while pushing for newer technologies amongst many other things.
Rana Hamarneh, group executive director and partner at Adpro Communications
“The past couple of years have been exceptionally difficult as brands, whether local or international, have had major budget cuts in lieu of the local and regional instability. Yet despite these difficulties, we have witnessed an increase in PSA (public service announcement) campaigns such as the ones led by the government and the public sector that aim to introduce new ways to serve Jordanian citizens.”
Traditionally, newspapers and television have dominated the media scene, with outdoor and radio playing their parts. However, the days of newspaper supremacy are numbered and digital, as with everywhere else, has made significant inroads. Media consumption and advertising spend are moving rapidly towards online, specifically social media, which has witnessed huge growth in spend from top brands. This trend is expected to continue during the coming years.
“Brands are realising the necessity to get closer and more personal with their consumers,” adds Hamarneh. “This is why I believe digital marketing will remain the fastest growing medium. Additionally, we will be seeing more money allocated towards experiential marketing, virtual reality, interactivity, engagement, content marketing, influencer marketing, referral partnerships, and other methods that are designed to deliver better perceived value to audiences. Finally, there is a significant chance that we will see blockchain disrupt the digital advertising ecosystem entirely.”
Creatively, however, Jordan has struggled. Its advertising output is mediocre at best, with only the occasional flourish of ideas or spurt of innovation. Arguably its most successful work in the past two years has come from Memac Ogilvy Advize, particularly its work for Royal Jordanian. The airline famously trolled Donald Trump in a social media campaign, leading to a 50 per cent increase in Royal Jordanian bookings to the US and organic reach of 450 million, and its ‘Fear of Flying’ campaign won a handful of awards at this year’s Dubai Lynx.
“We need to take into consideration that Jordan is a very traditional market when we talk about communication,” says Milovanovic. “The work you can see in mainstream media is very ‘normal’, and it’s been like that for years. In order to do work that you can be confident can be sent to Cannes, for instance, you need to make the effort to not only be creative, but also to persuade the client beyond regular terms of business.”
As for the future, Zenith forecasts a more positive 2019, and with improved cross border cooperation with Syria and Iraq, that could well be the case.
“As we are beginning to witness an increase in the stability of the region, I strongly believe that 2019 will be a better and more prosperous year,” says Hamarneh. “Jordan has and will continue to embrace new technologies and adapt to the rapidly changing industry and will hopefully be a vital player in those countries that have been impacted the most in the past couple of years.” -
Jordan is a very traditional market… The work you can see in mainstream media is YHU\ ¶QRUPDO· DQG LW·V been like that for years. In order to do work that \RX FDQ EH FRQÀGHQW FDQ EH VHQW WR &DQQHV IRU LQVWDQFH \RX QHHG to make the effort to QRW RQO\ EH FUHDWLYH EXW also to persuade the client beyond regular terms of business. Ivan Milovanovic, managing director of Y&R Amman