If Saudi Arabia’s advertising scene was smoldering quietly for a couple of years, it exploded in 2007. And, says Toni El Rahi, Riyadh branch manager for media buying unit OMD, the fireworks are set to continue over the next 12 months, at least. “2007 was very good,” he says. “Better than 2006 by far. With Riyadh clients, there was no big difference between 2005 and 2006.”
The Kingdom had been waiting for a blast of energy from the real estate market, which never came. Instead, telecoms rushed from behind to dominate the market. With MTC rebranding as Zain and going head to head with Saudi Telecom (STC) and Etisalat’s Saudi Arabian identity Mobily, highly publicized offers from these competitors became the talk of the town.
“You can hear them,” says El Rahi. “What they are talking about is, ‘What’s the offer now on Mobily? When does the next STC promotion begin?’”
The other industry that bolstered the Saudi ad business was insurance. Newcomers and newly privatized companies invested in marketing as they fought for dominance in a market that the government finally opened up this year.
“Around 16 insurance companies came to KSA. They are now publicly owned, and they closed out the smaller companies,” says El Rahi. In October, state-owned NCCI rebranded as Tawuniya under the guidance of The Brand Union (formerly Enterprise IG), and invested heavily in pushing its new identity.
None of the big growth areas – telecoms, real estate and insurance – looks set to check its ad spend in 2008, and outdoor suppliers are particularly set to benefit from the telecom play-off.
“They started spending only recently,” El Rahi says. “But next year, we believe, most of the outdoor space in KSA will be booked by the three largest telecom companies – Zain, STC and Mobily. So for other players it will be very hard to use outdoor advertising.”
In fact, the future looks so bright that El Rahi says the biggest problem facing the industry for next year will be making space to accommodate the explosion of business. He says the Saudi ad industry’s New Year’s resolution for 2008 should be, “to find enough room for all the big accounts. Because we are expecting if not to double our billings from this year, at least a 50 percent increase on 2007.”