The out of home advertising sector is extremely competitive, and worth hundreds of millions in terms of revenue. This week one of major players, Ken Varejes, CEO of Primedia Unlimited, took on Melissa Moore, executive director of industry body, Out of Home Media South Africa (OHMSA), over what he perceives to be incorrect reporting of OHMSA’s figures.
OHMSA claims to represent 65% of the adspend of the OOH market. Varejes says OOH operations that don’t belong to OHMSA, and who might not report their figures to AdEx, are actually responsible for 74% of the adspend, and that OHMSA members are worth 26%.
“OHMSA represents a range of players, but they don’t represent the majority of out of home companies,” says Varejes. “Continental Outdoor, one of the biggest players in South Africa – and Africa – pulled out and they handle enormous amounts of billboard advertising. Airport Media represents the airport advertisers and they’re not member either.”
Varejes says he – and Deloittes – analysed the year on year figures from July 2010 to June 2011. The adpsend totaled around R1.26 billion. But, says Varejes, many companies don’t report to AdEx (he reckons reporting segments aren’t properly broken down and companies can’t report as the segmentation doesn’t fit their offering.
“Those figures are also based on rate cards so they’re not real. I reckon we could work on a figure of approximately 70% of rate card figures, and that’s generous. We all know how much discounting goes on!” says Varejes.
“My numbers were audited by Deloittes and we’re looking at a gross of around R410 million. That includes all the companies that fall under Primedia Unlimited.” This would encompass companies such as TLC (washroom advertising), Primall Media, XP Digital, and Mamba Media, among others.
Varejes says he contact Continental Outdoor for an indication of what their numbers are. “We’re looking at around R630million, if I’m being kind,” he says.
Varejes supplied the numbers he has worked out.
Although the Out of Home section in AdEx does not break spend down into media owners, Continental Outdoor have confirmed that their inventory makes up 50% of spend in this category. Please note that although Continental Outdoor do not belong to OHMSA they still submit their figures to AdEx.
Moore was not available to comment this week as she is on leave. But she told Business Day newspaper last week that “the association was aware of Primedia Unlimited’s concerns”.
“We indicated approximately a week ago to Mr Varejes that the figures quoted in our press statements are approximate figures, which (are) also indicated in the press statements that he has taken issue with,” she told the newspaper.
In the meantime, OHMSA has opened its doors to more members. It recently opened associate membership to industry stakeholders such as advertising agencies, poster-buying specialists, landlords, marketers, suppliers and industry bodies.
At the time, executive director Moore said that if OHMSA was to “truly represent the out of home industry and have deeper insight into sector challenges, we have to create free-flowing dialogue. We also want to acknowledge the broader industry for their role in the out of home sector’s economic success. As such, it makes sense for us to share issues on a common association platform”.
“We also want to dispel the perception that OHMSA acts only in the interests of the bigger players. We strive to acknowledge the smaller players and elevate their voices,” she says.
OHMSA would represent the concerns of the entire out of home industry, instead of focusing on billboards, which has been tradition.
