GMA 7 expects rise in ad spending in ’12
After a challenging year, broadcast giant GMA Network Inc. is optimistic that the next 12 months would be better for the company on the back of the improvement in its nationwide ratings and the anticipated increase in ad spending.
GMA Network chairman and CEO Felipe Gozon said political “advocacy” placements toward the end of 2012, ahead of the 2013 mid-term elections, would help lift profits.
“We are doing well. We started negotiations with advertisers and we already have commitments that can cover 70 percent of our ad revenue target for the entire year,” he told reporters at the sidelines of GMA’s trade launch Wednesday.
He said profits might reach P3 billion in 2012, higher than the less than P2 billion that the company was expected to post in 2011.
The only threats are the economic problems in Europe and the United States, Gozon said.
At the start of 2011, broadcast firms believed that optimism on the Philippine economy would help bolster advertising revenues.
However, various crises in other parts of the world, particularly the debt woes in Europe, rising unemployment in the US and the natural calamities in Japan, forced many multinational firms like Unilever and Proctor & Gamble to cut back on spending.
“Those decisions were being made by their head offices abroad. We had no power to stop that,” Gozon said.
But as of late, GMA top officials said the indication had been that these cutbacks would start to abate this year.
“There are advertisers speaking of growth. Some are talking about keeping the status quo. But on the whole, there should be an increase,” GMA president Gilberto Duavit Jr. said.
Duavit said the company’s ratings lead over rival ABS-CBN has also widened, leading to the expectation that the former would get a bigger share in the total advertising revenues.
Ratings data by research firm AGB Nielsen at the end of the year showed GMA ahead in the nationwide race with an average total day audience share of 34.2 percent, three points ahead of its rival ABS-CBN.