Nigeria’s advertising industry valued at  N605.2bn – PwC Report

Nigeria’s advertising industry valued at  N605.2bn – PwC Report

ARCON
By Fabian Ekeruche
Lagos, June 11, 2024 (NAN) A new report by the  PricewaterhouseCoopers (PwC) has estimated Nigeria’s advertising industry contribution to the Gross Domestic Product (GDP) at N605.2 billion.
The report commissioned by the Advertising Regulatory Council of Nigeria (ARCON) was funded by various industry associations to shed light on the advertising sector’s contribution to the nation’s GDP,  its value and multiplier effect.
The News Agency of Nigeria (NAN) reports that the new report carried out by PricewaterhouseCoopers (PwC) was presented to stakeholders on Tuesday at a news conference in Lagos.
Speaking at the unveiling, ARCON Director- General, Dr Olalekan Fadolapo, expressed optimism about the industry’s recent strides, including the launch of an Audience Measurement initiative last week.
Fadolapo expressed gratitude to the various  sectoral groups that funded the study.
He listed the sectoral groups as the Experiential Marketers Association of Nigeria, the Association of Advertising Agencies of Nigeria, the Outdoor Advertising Agencies of Nigeria, the Media Independent Practitioners Association of Nigeria and the Broadcasting Organisation of Nigeria.
He also underscored the need to quantify the industry’s size and impact as an economic enabler.
“We cannot continue to guess and estimate the size of the industry. This report lays the foundation for us to assess the advertising space and its multiplier effect on the economy every year going forward,” Fadolapio said.
He added that findings of the report underscored the industry’s paramount role as a catalyst for consumer demand, business expansion, employment and innovation across sectors.
Fadolapo added that ARCON would hold an event on the audacious rebrand Nigeria project  that it had undertaken along side other projects as part of resolutions from the communique of the National Advertising Conference.
Also speaking, Mr Tunji Adeyinka, the Chairman of the National Advertising Conference, provided context on the study’s genesis.
Adeyinka explained that the 2022 conference highlighted a gap in understanding the industry’s GDP contribution, prompting the decision to engage PwC for a credible assessment.
He added that the report examined two key aspects: the advertising industry’s direct monetary contribution to the GDP and its multiplier effect – the amplified impact of advertising investment on overall economic output.
In his presentation, Dr Femi Adelusi, Chairman of the Multiplier Study Committee, revealed the profound impact of Nigeria’s marketing communications industry in driving the nation’s economic growth.
“The marketing communications sector has emerged as a formidable economic powerhouse. “The study estimates that for every N1 spent on marketing communications in Nigeria, the nation’s GDP increases by a staggering N16.5 – a multiplier effect that highlights the industry’s substantial value contribution.”
Referencing the report, the total expenditure on marketing communications reached an impressive N605.2 billion in 2023, having grown at a remarkable compound annual growth rate (CAGR) of 18.7 per cent over the past six years, from N216 billion in 2018.
He said the  trajectory was projected to continue, with spending expected to reach N893 billion by 2028, contributing a significant 1.08 per cent to Nigeria’s GDP, up from 0.7 per cent in 2023.
Dissecting the industry’s segments, he said the top three contributors to marketing communication spent between 2018 and 2023 were cable TV (25.5 per cent), digital media (18.5 per cent), and creative & content production (13.4 per cent).
“The proliferation of cable TV, driven by its diverse content offerings and affordable package options, has captivated a wide consumer base.
“Additionally, the surge in digital media spend, fueled by increased internet and mobile penetration, as well as the rise of social media and video-on-demand platforms, has reshaped the marketing landscape,” Adelusi said
He said the study also highlighted the growing influence of creative and content production, which recorded a CAGR of 15.8 per cent between 2018 and 2023, driven by the popularity of smartphones, social media engagement, and the appeal of real-time online content.
“The investment by video-on-demand platforms like Netflix and Amazon Prime in Nigerian productions, particularly in the thriving Nollywood industry, has further bolstered this segment,” he added.
He said the study also stressed the ability to leverage technological innovations like AI and big data analytics, Nigeria’s large and culturally diverse market, and the potential for innovative, locally-tailored marketing approaches.
He said that in accelerating the industry’s growth and development, the study outlined the following key recommendations.
“Creating specific, measurable goals for the sector’s GDP contribution, establishing a Joint Industry Body for operational coordination among broadcasters, agencies, and advertisers.
“Encouraging strategic alliances among industry players, embracing a “global” approach that combines international best practices with local initiatives, and utilising analytics tools to track spending patterns and consumer behaviour meticulously.
“The marketing communications industry is an economic force that deserves recognition and support.
“By implementing these recommendations, we can unlock the industry’s full potential, drive sustainable growth, foster job creation, and cement Nigeria’s position as a leading marketing communications hub in Africa and beyond,” Adelusi said.(NAN)(www.nannews.ng)
FBO/JNC
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Edited by Chinyere Joel-Nwokeoma