Blank TV screens: ABS-CBN’s fall spells losses for billion-peso ad industry
MANILA, Philippines — The day ABS-CBN Corp. was forced by the government to stop airing, advertising executives watched in horror as half their market vanished when millions of television screens across the country went dark.
The ad industry’s growth was fuelled as much by consumerism and its own creativity as the distribution outlets inside people’s homes—the TV set— that were enabled by broadcast giants ABS-CBN and GMA Network Inc.
Both companies dominate the competition in a country where TV remains the undisputed king of media, accounting for about 75 percent of the estimated $3 billion (P151 billion) advertising business.
“The Philippines is still very much a TV country,” Gladys Basinillo, a media advertising veteran with over 25 years of expertise, said in an interview with the Inquirer. “It’s like they removed 50 percent of the advertisers’ reach. This is a big impact for us.”
ABS-CBN’s shutdown, which came before 8:00 p.m. on Tuesday, was immediately felt.
“Some of the viewers switched channels, but majority simply turned off their TV sets after 8:00 pm,” Basinillo said, citing data from third-party research firm Kantar Media.
The industry is now coming to terms with the implications of the shutdown and how brands— from global giants that sell toothpaste and shampoo to local fastfood chains marketing fried chicken—might recalibrate their media strategy.
“The move was so sudden and everybody, more so, the large stakeholder entities, thinkers and planners were caught flatfooted,” Dan Villa, chair of advertising agency CreatiVilla, said in a statement.
These changes are also coming as the industry reels from the coronavirus pandemic, which has forced big companies to divert advertising budgets to relief efforts or to conserve cash as the economy slips into recession.
Two advertising executives, who declined to be named, said the National Telecommunications Commission’s cease and desist order against ABS-CBN threatens jobs in advertising, which supports thousands of Filipinos.
This is on top of doubts now hanging over ABS-CBN’s 11,000 workers.
“There is some talk now that companies might spend less if they feel they can’t reach their audience. This is bad for us,” one of the executives said.
GMA Network is a natural substitute given its scale but there are limits to how much advertising it can absorb.
“There is not going to be a big shift to the rival station, GMA, principally because GMA is almost all full,” said Menardo G. Jimenez Jr., senior vice president for PLDT, which advertises in ABS-CBN.
Jimenez, whose family is among the major shareholders of GMA, said they will shift to digital or the PLDT Group’s own television platform, TV5.
Digital platforms such as social media are often cited as an alternative but the industry remains skeptical.
“I have nothing against digital advertising but it’s hard to match the reach of free-to-air TV,” one of the ad executives said.
For one, online viewers tend to be younger and have less spending power. Companies launching a new product, such as a detergent or laundry soap, will be looking at a broader and more mature audience.
These are some of the evolving challenges facing the industry and its many components.
There are the advertising agencies, which are the “creative” side of the business who conceptualize the campaigns we see on TV and billboards. Then there are media agencies, which advise clients on how to distribute ads between television, print, radio, or other formats depending on the budget.
Some of these media agencies use sophisticated tools and technology to ensure brands reach their target audience.
“As a media buyer, our concern basically is the deliveries we committed to the client. Let us be practical. ABS-CBN really delivers,” a media agency employee said.
Across the industry, the shock over ABS-CBN’s shuttered broadcast business has yet to fade. Several agencies still had ad materials being readied to air once strict quarantine measures were lifted.
For some, the loss went beyond business.
“With this pandemic, the audience, the general public, has never been more attuned to the news, and television is still a pervasive and good source for a lot of our masses and they have put it upon themselves to be factual,” the ad executive said.
Subscribe to INQUIRER PLUS to get access to The Philippine Daily Inquirer & other 70+ titles, share up to 5 gadgets, listen to the news, download as early as 4am & share articles on social media. Call 896 6000.