OPINION: GOODWIN ON ... THE TOBACCO AD BAN

By FRANCIS GOODWIN, campaignlive.co.uk, Friday, 02 July 1999 12:00AM

The Government’s decision to bring forward the long-planned tobacco ad ban to the end of the year is a short, sharp shock to the outdoor industry, which had attempted to negotiate a measured withdrawal that would give media owners enough time to prepare for the transition in an orderly manner.

The Government’s decision to bring forward the long-planned tobacco

ad ban to the end of the year is a short, sharp shock to the outdoor

industry, which had attempted to negotiate a measured withdrawal that

would give media owners enough time to prepare for the transition in an

orderly manner.



Why the Government has broken ranks with most of the rest of the EU in

bringing in the ban two years early is a mystery, but it looks

suspiciously like a PR stunt. Even the Germans, who are hardly wild

advocates of unfettered free enterprise, are adhering to the original

deadline of December 2001.



The irony is that the ban will barely affect the tobacco companies but

will have a discernible impact on third parties. In particular, outdoor

contractors will have to replace anything between 5 and 20 per cent of

their business, while the site landlords are likely to receive lower

revenues.



Clearly, this will cause a short-term problem for the large-format

contractors who benefit from tobacco outdoor advertising expenditure.

Currently, tobacco accounts for 4 per cent of outdoor income overall but

it makes up 7 to 8 per cent of the large format’s business. In the case

of some of the smaller contractors, this figure could be over 20 per

cent.



Yet, irritating though the decision is, the problems should be no more

than a blip, since the outdoor business has been preparing for a total

ban for several years now. In the face of the restrictions imposed and

voluntary agreements reached during the 90s, which have steadily reduced

tobacco expenditure in the medium, we have marketed ourselves far more

aggressively to a wide range of advertisers.



While tobacco dominated the outdoor medium just two decades ago,

accounting for 35 per cent of its revenue in 1977, there are now nine

larger product categories. The automotive and entertainment/media

sectors respectively account for 16 and 13 per cent of outdoor revenue,

while retail, travel and transport and cosmetics and toiletries each

account for 5 per cent.



Similarly, only 35 per cent of the top 200 advertisers used outdoor in

1991, but 88 per cent do so now. And outdoor has been one of the fastest

growing media in recent years, now accounting for more than 6 per cent

of the display advertising market.



In fact, the ban will produce some unexpected benefits for

advertisers.



For years, the tobacco companies have tied up certain sites on a

long-term basis. Now these will be released, enabling advertisers and

agencies to take a fresh look at planning and, with the help of the

latest Postar information and analysis, build even more effectiveness

into their campaigns.



Secondly, advertisers should be able to plan their large format

campaigns on the basis that there is likely to be virtually no cost

inflation in 2000, since the outdoor industry will be working hard to

replace lost revenues at current rates.



So this episode should have a silver lining for our customers and, one

hopes, lead to a further surge in the number of brands planning to use

large formats.



Francis Goodwin is the managing director of Maiden Outdoor.



This article was first published on campaignlive.co.uk

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