Marketing industry moves beyond product focus

HCM CITY (VNS)— The time when advertisements mainly described products and spoke about their usefulness is gone forever, experts said at a conference held in HCM City last Saturday.

Advertising has instead become a tool to convey messages and ideas including the fostering of communities and protecting the environment, and this is a new stage that Viet Nam has entered, said Do Kim Dung, chairman of Viet Nam Institute of Advertising.

He said many interactive advertising campaigns in the world have helped people come closer together and people now like to watch ads that do not contain any advertisement.

Vietnamese people have a "high community spirit" and remain rooted in Asian culture, therefore advertisements that appeal to these characteristics are likely to be most effective, said Dung, who is also deputy chairman of the Viet Nam Advertising Association.

Viet Nam's advertising industry is a relative newcomer in the world after decades of war, but five out of six big communication groups in the world are already present in the country, he said.

In Viet Nam, TV channels accounted for 78 per cent of the total advertising market in 2010, compared to 41 per cent in the Asia-Pacific region.

"Out of home" advertisements hold a very small share – about 4 per cent – of the advertising market, compared to 11 per cent in the Asia-Pacific region, he said.

Regulations relating to out-of-home advertising are very complicated in Viet Nam, causing difficulties for providers of these services, he said, suggesting that the government reviews them.

He also wanted the advertising and promotion expense cap imposed by the government to be removed so that enterprises can have more space to promote their brand names and expand production.

The cap has been in effect for 13 years, allowing enterprises to only deduct advertising costs if they are under 10 per cent of their total input costs.

It is estimated that for newly-established enterprises, advertising expenses could amount to as much as 15 per cent of total expenses for their first three years.

The global adverting industry is expected to achieve a growth rate of 4.7 per cent this year, with Asia-Pacific region well above the average at 7.2 per cent.

TV advertising will gain highest revenues this year globally, followed by advertisements in newspapers and magazines and the Internet, according to Dung.

However, revenue from Internet advertising is expected to exceed those from print publications next year. — VNS