Aviation media firm Aero Media Co is looking to beef up its overseas presence to drive up revenue growth by 25-30% a year.
The company is looking to expand its aviation media management business into Indonesia, Laos, Vietnam, and Myanmar to tap into high potential in markets that are attracting international and domestic travellers driven by low-cost airlines, according to Tatchai Patipoksut, managing director of Aero Media Co.
Founded in 2013 under LED Advance Co, the company's name was changed to Aero Media in October 2015 after VGI Global Media Plc, the flagship media firm of BTS Group Holding Plc, took a 30% stake in the company in May 2015.
Aero Media is the holder of licences to manage various forms of advertising at 13 airports operated by Airports of Thailand Plc and the Civil Aviation Department.
According to Mr Tatchai, Aero Media will find local business partners to facilitate operations in the countries the company is looking to invest in since each one has different regulations and conditions.
Aero Media will focus on investing in 14 major airports in four countries because of the high density of people traffic of at each one, Mr Tatchai said. They involve six airports in Indonesia, five in Vietnam, two in Myanmar and one in Laos.
"In the next 2-3 years, I'm confident Aero Media will be the leader of aviation media in Southeast Asia thanks to our know-how and longstanding experience in the aviation media management business," said Mr Tatchai.
Last year, Aero Media posted total revenue of 140 million baht, a 100% surge from 70 million baht in 2015. It expects to generate 350 million baht this year.
According to Mr Tatchai, the company will be awarded a media management operating licence at one of the target airports by the last quarter of this year but declined to give more information, citing a confidentiality agreement.
"Aero Media aims to move into the remaining airports over the next 3-5 years," Mr Tatchai said.
He said overseas expansion is a part of the company's business diversification for long-term sustainable growth.
Despite setting its sights on overseas expansion, Mr Tatchai believes Aero Media will retain a good long-term relationship with domestic concession owners -- Airports of Thailand Plc (AoT) and the Civil Aviation Department -- given the company's present performance that helps keep their airports vibrant with creative advertising.
Mr Tatchai said despite low growth in overall media expenditure, out-of-home media outlets have performed well over the past five years, with healthy growth of 40% per year compared with only 2% in overall media spending.
Mr Tatchai said aviation media spending has seen outstanding growth of 60% over that period, surpassing all transit media which comprise the BTS sky train, subway and city-run public transportation whose growth percentage was 20%, 15%, and 20% respectively.
Aviation media expenditure is estimated at about 1.5 billion baht out of a total media expenditure worth 100 billion baht a year.
Mr Tatchai said the key element behind aviation media growth in the past five years has been the rise of low-cost airlines that has seen aircraft numbers grow from 21 in 2011 to 136 in 2016.
This in turn drove passenger numbers up by about 100% from 71.5 million people to 140 million people last year.
"More passengers means there are more eyeballs, and this is the main force behind aviation advertising growth in the past 5 years." Mr Tatchai said.
He predicted the industry will grow 20-30% this year on par with the growth of airports in the country.
The Department of Airports (DOA) is upgrading its 28 airports and finishing construction of a new one in Yala's Betong district at an estimated total cost of 36 billion baht to meet an expected surge in passenger numbers over the next 10 years.
The move is in line with a plan to improve the country's aviation industry to make Thailand a key regional aviation hub.
Under the plan, a total of 39 airports nationwide will be upgraded and developed to handle an expected 277 million passengers annually within the next 10 years.
Of the 39 airports, 28 are operated by the department, including Betong in Yala.
Another six are run by the AoT, three are operated by Bangkok Airways Plc, while the other is the navy's U-tapao airport.