Nigeria’s advertising industry valued at N605.2bn, says PwC

PricewaterhouseCoopers (PwC) says the value of Nigeria’s advertising industry rose to N605.2 billion in 2023, from N216 billion in 2018.

PwC made this known in a report compiled on behalf of the Advertising Regulatory Council of Nigeria (ARCON) and various advertising industry associations.

The report titled ‘Economic Contribution of the Marketing Communications Industry to the Nigerian Economy’ was unveiled on Tuesday by ARCON.

The study highlighted the advertising sector’s contribution to the nation’s gross domestic product (GDP), its value, and its multiplier effect.

PwC projected the value will reach N893 billion by 2028.

While presenting the industry report, Femi Adelusi, chairman of the multiplier study committee, said for every N1 spent on marketing communications in Nigeria, the nation’s GDP increases by N16.5.

“The marketing communications sector has emerged as a formidable economic powerhouse. The study estimates that for every N1 spent on marketing communications in Nigeria, the nation’s GDP increases by a staggering N16.5 – a multiplier effect that highlights the industry’s substantial value contribution,” Adelusi said.

He said the projected N893 billion by 2028 will contribute “a significant 1.08 percent to Nigeria’s GDP, up from 0.7 percent in 2023”.

TOP THREE CONTRIBUTORS TO ADVERTISING SPEND

Adelusi said the top three contributors to advertising spend between 2018 and 2023 are cable television (25.5 percent), digital media (18.5 percent), as well as creative and content production (13.4 percent).

“The proliferation of cable TV, driven by its diverse content offerings and affordable package options, has captivated a wide consumer base,” he said.

“Additionally, the surge in digital media spend, fueled by increased internet and mobile penetration, as well as the rise of social media and video-on-demand platforms, has reshaped the marketing landscape,” Adelusi said.

According to Adelusi, the popularity of smartphones, social media engagement, and the appeal of real-time online content is improving the influence of creative and content production.

“The investment by video-on-demand platforms like Netflix and Amazon Prime in Nigerian productions, particularly in the thriving Nollywood industry, has further bolstered this segment,” he added.

The report highlighted economic pressures, regulatory reforms, and competition from global players as challenges faced in the industry.

However, the study said rising digital trends, opportunities for local and international partnerships, the ability to leverage technological innovations like artificial intelligence (AI) and big data analytics, Nigeria’s large and culturally diverse market, and the potential for innovative, locally-tailored marketing approaches are some of the strengths of the industry.

PwC outlined key recommendations to accelerate the industry’s growth and development, some of which are creating specific, measurable goals for the sector’s GDP contribution, encouraging strategic alliances among industry players, and utilising analytics tools to track spending patterns and consumer behaviour meticulously.

Commenting on the report, Olalekan Fadolapo, ARCON director general (DG), emphasised on the need to quantify the industry’s size and impact as an economic enabler.

“We cannot continue to guesstimate the size of the industry. This report lays the foundation for us to assess the advertising space and its multiplier effect on the economy every year going forward,” He said.

Fadolapo said the findings of the report underscore the industry’s paramount role as a catalyst for consumer demand, business expansion, employment, and innovation across sectors.