SUPPLEMENT: WORLDWIDE ADVERTISING; COUNTRY PROFILES: Singapore

The Singapore ad industry may be growing but, in many ways, it is a victim of its own success. As it matures, shops based in Singapore risk being undercut by their regional competitors. Richard Cook reports

The Singapore ad industry may be growing but, in many ways, it is a

victim of its own success. As it matures, shops based in Singapore risk

being undercut by their regional competitors. Richard Cook reports



Opportunities



Advertising agencies in Singapore have long enjoyed the best of both

worlds - highly educated, ad-literate consumers that provide a willing

audience for top-notch creative work and an economy that has been on a

steady - and at times spectacular - upwards curve for the best part of

20 years. The economy of Singapore is now highly developed, with the

world’s highest level of direct inward investment and an annual growth

rate of around 9 per cent.



Partly because the island state enjoyed spectacular growth just when the

West was experiencing a recession, it attracted an unusually large

number of expat advertising creatives and executives. The creative

reputation enjoyed by the likes of Batey, Saatchi and Saatchi, Ogilvy

and Mather and the Ball Partnership in Singapore outstrips anything else

in the region.



It is little surprise then that Bartle Bogle Hegarty has narrowed its

choice of a first South-east Asian office down to Singapore and Hong

Kong, or that the media independent, CIA Medianetwork, chose Singapore

as the venue for its first joint venture in the region, with Batey, last

year.



Media



Singapore is unusual among South-east Asian nations because TV is not

the dominant advertising medium. That distinction falls to an unusually

well-resourced newspaper industry.



The English language paper, the Straits Times, has a circulation of

368,000 and a readership of more than 1.1 million, comfortably making it

the best-selling daily.



Its owner, the Government monopoly, Singapore Press Holdings, also

controls a string of Chinese language dailies. These are led by Lian He

Zao Bao, which has a circulation of around 210,000 and is read by more

than 700,000 people.



The Sunday stable is led by the English language title, the Sunday

Times, which sells around 400,000 copies and claims a readership of more

than a third of Singapore’s three million population. Consequently, it

publishes the stiffest ad ratecard in Singapore.



Together, these strong titles have helped newspapers to capture a 50 per

cent share of total adspend. Real estate, retail and entertainment are

the three largest product areas.



There are just three terrestrial TV stations: Channel 5, Channel 8 and

the relative newcomer, Channel 12, which launched in 1984.



There are three broadcast subscription channels, and low cable

penetration of around 4 per cent. TV represents about 35 per cent of

total spend, although its share is growing faster than that of

newspapers.



‘The media options in Singapore are quite straightforward,’ Anthony

Young, the Saatchi and Saatchi regional media director, says. ‘And

because most of the press is owned by one company, and most of the TV by

another, there is more inter-media competition than in other markets.’



Outdoor represents just 3 per cent of total adspend.



Radio stations are led by the Chinese language station, 93.3FM, and take

more than 5 per cent of total ad revenue.



Infrastructure



Singapore is not known as the Switzerland of South-east Asia for

nothing. The streets are clean, the trains run on time and the level of

information technology support is practically unparalleled anywhere in

the world. Even the taxis can be ordered via a state-of-the-art

satellite-based phone booking system.



Corporations that were once based in Hong Kong are starting to transfer

their offices to Singapore in advance of its handover to the Chinese in

1997. With its significant Chinese and Malay population, Singapore is

increasingly seen as a useful base from which to target the faster

growing South-east Asian markets such as Vietnam, Laos and Cambodia, and

for dealing with mainland China.



Local people are starting to dominate even the international agencies

and account for roughly half of the top management and top creative

posts. The workforce is generally educated to a higher standard than in

the UK, and agencies are all connected to the latest online research

services.



‘The infrastructure is better than New York and London by far,’ Neil

French, Ogilvy and Mather’s regional creative chief, says. ‘Standards of

TV production are high and the standard of printing, and colour

printing, especially, is far in advance of anything in the West, which

helps explain the success of newspapers here.’



Problems



Singapore is, in many ways, a victim of its own success. Its per capita

GDP is by far the highest in the region, but the growth in advertising -

which has doubled over the past five years - is beginning to slow.

Singapore is starting to assume some of the characteristics of a mature

advertising market.



‘The real pressure on agencies in the future is going to come from

direct marketing and below the line,’ Young says. ‘And because Singapore

is surrounded by countries at an earlier stage in their development, it

can seem relatively expensive to a multinational client planning a

regional campaign. Certainly, in media terms, its cost per thousand is

high in relation to the rest of Asia and already we can see that

Singapore is having to compete for media budgets with Malaysia. The

Malaysian consumer is not as rich but it is much cheaper to buy

campaigns there, and there is five times the population.’



Another potential problem for advertisers and their agencies are the

tight Government controls on the content of ads. Leo Burnett had an ad

for Milo pulled in a celebrated case simply because it featured a boy

answering his father back. And the Government morals board takes an

extremely dim view of the most veiled references to sex and drugs.



‘When I worked there I had work pulled simply because the authorities

thought that it was poking fun at the US,’ Marc Shaffner, a creative

director at McCann-Erickson in New York who spent four years at McCanns’

Singapore office, says. ‘I think that can tend to inhibit creativity.

Another potential creative problem now is that there is currently a

trend to use endorsements from famous Asian personalities in

commercials. Local comedies are, for the first time, outperforming

imports in terms of ratings - so there is excellent recognition but it

can make for dull advertising.’



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