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Vol. 4 :: No. 1 January,
2002 (Paush
- Magh)
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Report |
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Advertising Business The closure recently of three magazines belonging to Times Inc. – On, Asiaweek and Family Lift – is testimony to the advertising recession happening on a global level. It is therefore not surprising that the advertising business in Nepal is witnessing a downslide. "In fact, our business has gone down by some 60 percent", relates Nirmal Raj Poudel, Chief Executive Officer (CEO) of Welcome Advertising Agency and Marketing Pvt. Ltd.
He traces the beginning of the negative trend in business to circumstances before the September 11 attacks in the United States. "It actually all began with the pro-Maoist movement against use of liquor and the subsequent measures promised by the government to restrict liquor use," claims Poudel. Then came September 11, triggering a global economic slump. Back home, the imposition of state of emergency on November 26 only added to the economic woe, albeit the general people have felt a sense of security. "Prohibition of consumer fairs, musical programs, etc. has had definite negative impact on our business," states Nabin Lal Joshi, Media Director of Thompson Nepal Pvt. Ltd. Ranjit Acharya, Chief Executive Officer of Prisma Advertising Pvt. Ltd., echoes a similar view. And adds, "The state of emergency has come as a surprise and not everyone has been able to comprehend the situation." The people have therefore preferred to act conservatively and hold on to their savings rather than spend money, he states.
Bhaskar Raj Rajkarnikar, the President of Advertising Agency Association of Nepal (AAAN) and the Chairman and CEO of Ad Avenues Pvt. Ltd., relates that although this period is probably the worst faced by the Rs 2 billion advertising industry, the current situation has had little bearing on his own business. "Because a major chunk of my clients include insurance and noodle companies," he reasons. Agreeing that the advertising industry has been severely hit by production cuts affected by manufacturing units, especially in the liquor sector, Rajkarnikar believes that failure on the part of the government to come up with a national advertising policy has much to do with the plight of the advertising agencies. Rajkarnikar also believes that classification of ad. agencies has become necessary. "This is mandatory to flush out unhealthy competition in the business," states the AAAN president. Nabin Lal Joshi points out at the repercussions affected on advertisement business by some prominent publications in the form of 20 to 40 percent enhancement in their tariff for advertisement space. "For a certain amount of money. I am alloted smaller space now in comparison to last year," he states.
Sources within the Kantipur Publications Pvt.
Ltd, however, relate that advertisers have been reluctant to advertise more
out of fear – both from Maoist extortionists and the tax department –
than due to tariff hike. Data from the publication reveals that although the
space bought by advertisers in the first five months of the on-going fiscal
year has gone down as opposed to the same period last year, there is little
to choose between the two corresponding periods in terms of financial
transaction. If net turnover of the publication during the last fiscal year
amounted to some Nonetheless, the reported job layoffs resorted to by most publications and the Kantipur daily, boasting of the largest readership in the country, now coming out with only 12 pages as projected to 16 pages earlier, is indicative of the fact that the economic slump in the print and advertising business in here to stay, at least for some time in the future. -By Nirjal Dhungana Ad. Agencies Ranked by Nepal Television on the Basis of Financial Transaction During FY 2056/57. 1 Syncro Media (P) Ltd. 2 Thompson Nepal (P) Ltd. 3 Media Times (P) Ltd. 4 Echo Advertising Service (P) Ltd. 5 Crayons Electra Nepal (P) Ltd. 6 Welcome Advertising & Marketing (P) Ltd. 7 National Ad & Marketing (P) Ltd. 8 Dina Advertising Service (P) Ltd. 9 Trikon Advertising (P) Ltd. 10 Media Co-operative (P) Ltd. Ad. Agencies Ranked by the Kantipur Publications (P) Ltd. on the Basis of Financial Transaction up to the Five Months this FY (2057/58). 1 CTC The Media People (P) Ltd. 2 Thompson Nepal (P) Ltd. 3 World Vision Ad (P) Ltd. 4 Media Team (P) Ltd. 5 Professional Advertising (P) Ltd. 6 Prisma Advertising (P) Ltd. 7 Trikon Advertising (P) Ltd. 8 Echo Advertising Service (P) Ltd. 9 Tufan Ad Agency (P) Ltd. 10 AN'S Creations (P) Ltd. AAAN Members
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