Portly advertisers forced to slim prices

Outdoor and other out-of-home advertisers are among the worst hit by the recent property market downturn.

Outdoor and other out-of-home advertisers, among the worst hit by the recent downturn in the property market, are diversifying their client bases, lowering prices and restructuring payment plans as they try to weather the economic downturn. Even large, global companies are feeling the pinch. JCDecaux Dicon, the UK-based advertising firm that recently signed a 10-year contract for exclusive advertising concessions at Dubai International Airport, is having to look to new places for clients as its old ones pull back their marketing budgets.

"Eighty-five per cent of our clients are in property," said Halima Khatoon, a sales manager at the company. "All our main targets were real estate." As property companies announce layoffs and stalled projects, JCDecaux has to widen its search for business. "We are planning to approach other brands - luxury brands, perfume. We want auto makers, all of the other kinds of brands," she said. It could also have to lower some of its rates. Until now, the company bragged that the prices it charged at its Emirates airline-occupied Terminal 3 locations were "10 per cent higher than Heathrow", Ms Khatoon said, but a review of some of its prices was likely "because the market has gone down".

Even if prices do not change, the way they are collected probably will. "Instead of yearly, we might give monthly prices," she said. These changes are not necessarily a bad thing, argued several members of the industry at today's Outdoor Advertising Forum in Abu Dhabi. Scott Rowe, the director of sales marketing and business development at Right Angle Media, which earlier this year won the concession for advertising on Dubai's bus shelters, believes a correction can restore health to the industry.

"If nothing else, the credit crisis, and particularly its effect on the property market, will drive the market to be more normal, just driven by one sector," he said. But in the near-term there will be pain. "It's affecting everyone. Our business has just dropped. Everybody is holding their horses," said Nabih Muslimani, the sales supervisor at Synaxis Media, the Abu Dhabi-based out-of-home digital media company responsible for the blinking LED advertisements in malls around the capital and Al Ain.

But the economic climate won't stop the company from switching on the lights of its first outdoor sign this week on the Fotouh Al Khair shopping centre, between Hamdan and Zayed the First streets on Airport Road. Dubbed the largest LED screen in the Middle East, Europe and Africa, "The Opulence" originally was scheduled to launch in September, but was delayed by shipping problems. It is now scheduled to go live by the end of the month. Able to hold 12 advertisements, with 10-seconds given to each spot, it would be visible from a kilometre away, he said.

"It's something unique," he said. "It's going to sell itself." But will it? Some experts are saying that the era of "the biggest in the world" buzz is now giving way to a period of tactical advertisements that offer consumers value and details. "If we witness a slowdown and recession, the content of the advertising will go towards more value and packaging, more tactical, trying to increase sales and affect sales directly, rather than building brands and establishing images," said Ghassan Harfouche, the treasurer of the International Advertising Association. "That's certain. That's how the past has been."