ADVERTISING

The Thai advertising industry has a bright outlook this year, with 10% growth in media spending expected amid political stability and rising consumption.

Ad executives say the momentum will continue from 2012, when the ad industry was projected to grow by 14% to 130 billion baht. Media researcher Nielsen Thailand reported total ad spending in the first 11 months last year stood at 110 billion baht.

Ad spending rose sharply as private companies beefed up post-flooding ad budgets and the soft-drink industry saw intensified competition between Coke, Pepsi and newcomer "est".

Moreover, the government spent 6.5 billion baht on public relations and advertising after launching schemes such as for first-time car buyers.

Vichai Suphasomboon, the chief executive of Aegis Media (Thailand), part of the London-based marketing group, said this year will see big changes in consumer behaviour after the introduction of third-generation (3G) commercial service.

The car buyer scheme will worsen traffic conditions, a potential boon for delivery and online businesses, he said.

"In my opinion, the ad industry will grow by at least 10% this year to be worth 135 billion baht," said Mr Vichai.

Meanwhile, the property sector will see new projects along skytrain and subway routes and in suburban areas, while the automobile sector is moving forward to promote new models, especially eco-cars.

Cinema, online and out-of-home media will enjoy higher growth than other categories this year.

But in terms of quality, TV remains the most valuable, with its 60% share of overall ad spending.

Sohn Chongsrichan, the chief executive of Young & Rubicam Thailand, said industry growth will be supported by economic expansion and the nationwide daily minimum wage hike to 300 baht, which together will boost consumer spending.

Higher purchasing power will spur the private sector to produce and bring more new products to market, especially fast-moving consumer goods.

3G service will encourage more new smart devices.

"But natural disasters such as floods remain risk factors this year, as we don't know when they will happen," said Mr Sohn.

He said firms have become familiar with political uncertainties, and many can adjust to circumstances.

Surachai Chetchotisak, the president and chief executive of RS Plc, said the economic atmosphere will improve this year as worries about the US "fiscal cliff" dissipate.

The broadcasting industry expects many changes this year once digital TV licences are issued.

Mr Surachai predicts his entertainment company will benefit and generate higher revenue and profits from satellite TV.

On the other hand, the new year brings the challenge of new players in the broadcasting business with the issue of non-frequency broadcasting licences in the coming months.

"I hope more ad budgets will shift from free TV to satellite and cable TV this year after some saw their ad revenue rise by up to 100% last year," said Mr Surachai. "They're a red ocean this year."