Ad spend held up in Vietnam last year

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HANOI--Advertising chiefs are stunned by AC Nielsen's claim that spending in their industry in Vietnam hardly fell at all across last year despite the regional and domestic economic gloom.

The market research firm announced ad spending in Vietnam throughout 1998 totalled $109 million, just $2 million down on 1997's tally.

"It was a big surprise because general spending within the industry was down," says Matthew Crawford, general director of Leo Burnett Co. Vietnam. However, Leo Burnett -- the only foreign agency allowed to do direct business in Vietnam, through a Business Cooperation Contract with a local firm -- believes many ad budgets will be slashed across 1999.

"This year will be very, very tough. It's going to be depressed. All companies have very, very tight budgets," Mr. Crawford adds.

Major international advertisers in the country have faced a slackening consumer demand and have tightened their advertising budgets accordingly, he observes.

AC Nielsen claims the regional economic downturn caused only a minimal drop in TV, radio, print and outdoor media advertising in 1998, but stops short of projecting a similar turnout for this year. "Last year, the advertising industry weathered the economic downturn well, but we are not sure about this year," says Quynh Anh, a spokesperson for AC Nielsen in Ho Chi Minh City.

Other ad industry figures agree leaner times are definitely looming. "I'd agree it's going to be a tough year this year, says Diep Lan Chi, a spokesperson for Bates Indochina. "Advertising spending in the first two months of this year has been down from last year."

Last year was the first since 1992 in which ad spending declined, although the massive growth of the early '90s fell away in 1996 when a 9% rise was recorded. In any case, growth was from a tiny base: total ad spending in the country in 1991 stood at just $6 million.

"Vietnamese companies generally can't afford the cost of advertising," says Tran Gia Huy, a sales executive at P&C Advertising Co. in Ho Chi Minh City. "We only look to foreign companies. We must wait for the recovery."

Copyright April 1999, Crain Communications Inc.

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