good news. The threat of industry regulation looms in one form of another in Australia and Russia, for example. But on the brighter side, look for the continuing opening of markets including India and Vietnam.
SYDNEY-The red hot issue of agency compensation is a focal point for 1995. The Trade Practices Commission promises a review of the accreditation system which could lead to deregulation of compensation. Meanwhile, the Australian Association of National Advertisers is arguing the present system of a fixed 10% commission on media buys plus 7.5% service fee is anti-competitive.
SAO PAULO-Brazil's hottest ad front in 1995 will be cola. Of Pepsi-Cola's total investment of $100 million, a big portion will go into advertising to increase its market share to 25%-up from its current 7%-by the end of next year. More competition is coming from Companhia Antarctica Paulista with a new brand Pop Cola, and Royal Crown Cola is also entering in 1995.
Cable TV expects to have its own legislation approved by the Senate in the beginning of the year, even though it's already been in the country for three years. The potential market is 6 million people.
Helped by legislation lowering taxes for imports, another market expected to grow is international mail order. Prices will drop by at least 50%, prompting soothsayers to predict the mail order business will grow 800% to $2 billion next year.
TORONTO-Starting next month, 10 specialty channels programs will begin cablecasting, following licenses granted by the Canadian Radio-television & Telecommunications Commission to a variety of telecasting groups.
PRAGUE-Privatization is expected to conclude in 1995, but newly-private companies will continue to provide a host of new accounts available to ad agencies in coming months.
The ad community is waiting to see whether or not the government will privatize another TV channel, opening the way for more competition.
CAIRO-The privatization of government-owned companies jolted marketers' competitive spirit, including unleashing an all-out cola war nationwide. Coke and Pepsi are battling for market share with a frenzy of new products, increased outdoor advertising and TV ads starting next year.
With increased competition from satellite dishes getting cheaper every day, Cable News Egypt has started to fight back by adding more channels for its subscribers. In December, CNE added movie, sports and children's channels to its package and ran a special promotion for subscribers to enjoy one free month of service.
PARIS-Although signs indicate the economy may improve in the first half of 1995, much is riding on the results of France's May presidential elections. Should the contest come off relatively smoothly, chances are good that marketers will feel secure enough to start taking bolder business steps.
DUSSELDORF-Market watchers are aghast that Mercedes-Benz is going downmarket by introducing a Swatch car by 1996. Mercedes stands for premium-priced cars, and its star symbol signals top quality.
"With this move, the shining Mercedes-Benz star may lose some of its shine," an agency executive said.
Prior to signing the agreement with Mercedes-Benz, Swatch inventor Nicolas G. Hayek had talked to Volkswagen's management but had been turned down.
BOMBAY-With the continued opening of the market, the coming year will witness the rapid proliferation of package goods and durables, credit cards and consumer finance programs.
Communications will be revolutionized with the operation of cellular phone services and, on the media front, the government's decision to lift the ban on foreign media will have far-reaching consequences.
"How do yesterday's media people cope with multichannel planning and media audience research results of today that [will be] totally invalid tomorrow?" said Sorab Mistry, Tara Sinha McCann-Erickson executive VP.
JERUSALEM-Tour operators are gearing up to market Egypt, Israel and Jordan with package trips and major advertising efforts slated for Europe and the U.S.
Expected to go into operation for the first time in 1995 are regional commercial radio stations, and a cable shopping channel, a year after TV first went commercial.
MEXICO CITY-With the North American Free Trade Agreement firmly in place, there's no novelty in imports anymore so marketers will have to compete ferociously to attract consumers' attention.
The government next year awards licenses for long-distance telephone service, opening up competition in 1997. U.S. giants AT&T, Sprint and MCI all have Mexican partners and are in the running, paving the way for a high-spending marketing war.
WARSAW-High tech may come to this country next year as Japanese games maker Nintendo presses forward in an all-out assault on Central Europe's largest market in a venture with Polish distribution company Entertainment Systems Poland. The company is working on a program that will let kids use their telephones to play the games they see on their screens.
Leo Burnett is handling the game for Nintendo, which resisted entering the potentially lucrative Polish market until the passage in 1994 of strict new copyright codes. Through the agency, the company is spending $300,000 in the last 60 days of 1994 to promote its games during the Christmas season.
MOSCOW-Russia's first advertising law is expected to be passed by early next year. The law will address three major factors: Whether the industry will be self-regulated or controlled by the state; the banning of alcohol and tobacco products advertising, and whether all advertising should be banned on TV and radio programs.
JOHANNESBURG-Local marketers and foreign investors will be tracking the fortunes of U.S. companies returned to South Africa following 1994's democratic transition, including Pepsi-Cola, Nike, Reebok, IBM, Sara Lee, Chrysler, Pillsbury and Kodak.
SEOUL-In 1995, the discount boom, hastened by the arrival of warehouse store Price Club last October, will create an upheaval in the nation's distribution industry. As a result, owners of small retail shops will join forces to create new discount stores to counter price slashing.
"The wind of revolutionary changes has already gripped the distribution sector and the wind will become more intense day by day," a market analyst said.
Korean automakers will continue to speed into the luxury market, bolstering their luxury car lineups to meet domestic demand for the inevitable day that foreign car companies are allowed to enter. The luxury market is tiny, about 1% of total passenger car sales, but it's up 37% annually since 1991.
MADRID-With changes in ownership pending and new TV ad legislation on the horizon, private TV stations seem to be at the do or die point. Barring a major revenue upturn, the stations either need to figure out a new business policy or, in the most dire predictions, close down.
The growing proliferation of new media in 1995, especially satellite and cable television, will reverse tradition, giving advertisers a rare opportunity in a buyers' market as media inflation will slow.
Suphanee Dechaburananon, media planning director, Ogilvy & Mather, Thailand, said newspapers will continue to have the highest growth rates due mainly to booming property and consumer retail sectors.
The result will be newspaper ad clutter and an increase in the number of newspapers with audited circulations. Local publications will try to strengthen themselves by building regional networks.
LONDON-Eurotunnel will be a big story in both business and leisure travel, but could still be either a flop or wild success. If the Eurostar service linking London with Paris and Brussels and the Le Shuttle channel crossing prove reliable, a major restructuring of the transport industry will occur.
Satellite TV will keep growing. Dow Jones-owned European Business News debuts in February, up against revamped NBC Super Channel and CNN International. Nickelodeon, Children's Channel and Turner's Cartoon Network are expected to fight for kid viewers.
In interactive media, British Telecom will start a major 2,500-home test mid-year.
HO CHI MINH CITY-Survey Research Group estimates that advertising spending will balloon to $450 million by 1997. Many ad agencies are setting up offices here and in Hanoi.