Over the last few years, there have been big changes in the landscape of the Nepali advertising and marketing industry. Digital disruption has impacted all realms of the industry from the creativity of marketers and advertisers to the media consumption by consumers. Apart from this disruption, the advertising sector is grappling with the recession which has affected the Nepali economy for the last two years. According to Bishal Purush Dhakal, Managing Director of AVANI Advertising Pvt. Ltd., the downturn is taking its toll as business prospects are bleak, and experienced professionals are leaving the country to seek opportunities abroad. In a conversation with the HRM, he talked about the current state of the Nepali advertising industry, the prospects of recovery, changes in the advertising dynamics, and the current focus of AVANI, among other topics. Excerpts:
Q: What impact is the economic downturn having on the Nepali advertising and marketing industry? Has the festive season helped ease the situation?
A: The economic downturn has had a direct impact on the Nepali advertising and marketing industry. Advertising is a crucial link in the overall ecosystem, connecting various dots to create a complete circle. Like other fields, the Nepali advertising industry is not immune to the effects of the economic slowdown. Unfortunately, the festive season hasn’t significantly eased the situation. Although there has been some momentum, we are yet to see a substantial impact.
Q: Which sectors do you observe are improving for advertising and marketing? How do you see the prospects of recovery?
A: In the present context, SME is the main sector where advertising and marketing opportunities are improving. Regarding the prospects of recovery, the industry needs to bounce back from its current rock-bottom stage. I think the advertising and marketing industry will bounce back by next year.
Q: How are marketers and advertisers facing the current challenges?
A: The current situation presents several obstacles for advertisers and marketers. The biggest obstacle is in the area of human resources. Retaining qualified workers in the country has become a major challenge. The advertising industry is currently dealing with the issue of ‘brain drain’ as talented individuals seek opportunities outside the country. In addition, the limited number of businesses and the incapacity to generate further business prospects increase the challenges faced by marketers and advertisers.
Q: Of late, the mainstream media (print media, radio, TV channels and online news portals) have been complaining that the big advertisers have drastically cut down their media spending. Is it due to the economic downturn or traditional media are losing their relevancy as platforms for marketing and promotion?
A: Both reasons have contributed to the decline in media spending by big marketers, including multinational corporations and private-sector businesses. First, the decline in advertising spending has been influenced by the economic downturn. Second, compared to previous years, traditional media channels have seen a decrease in both traffic and relevancy.
Q: Digital platforms and social media are effective in reaching out to a large audience. How do you view the future of traditional mediums such as print and television?
A: Digital advertising is not replacing traditional mediums but rather, complementing them. Digital advertising has brought SMEs into the advertising industry and extended advertising reach even to remote areas. Digital and traditional advertising complement each other in reaching different audiences and achieving diverse marketing objectives. For example, even major global brands like Amazon continue to advertise on television.
Q: Are Nepali advertisers and marketers taking a different approach to dealing with the difficult market situation? How should their creativity be directed in times like these?
A: Creativity can be customized depending on the platform according to how well they work. Due to the affordability factor and rising internet penetration, the digital platform has become more popular as economic activities are currently limited. Clients are increasingly opting for a digital presence, and accordingly, creativity is being channeled toward influencer marketing, SEO, and content writing.
Q: What approach in creativity and business Avani Advertising and your other companies are taking at present?
A: Avani Advertising approaches creativity from a client-centric perspective. Our priority is to comprehend and meet the unique needs and goals of every brand. At present, we are prioritizing digital and below-the-line (BTL) advertising.
Q: How have digital and social media changed the landscape of advertising and marketing in Nepal?
A: Digital and social media have widened the horizon for advertisers. Previously, only those who had an appetite for advertising could advertise their brands or products. But today even a small outlet, even a small restaurant serving local food, has a digital presence and promotes its brands digitally. So, it has widened up the horizon bringing non-advertisers into the advertising field, which is commendable because advertising now can be in the appetite of even small business owners. Big brands have a variety of advertising mediums, but even the smaller ones can now have access to digital advertising.
Additionally, digital and social media have created new opportunities for influencers. In the past, becoming an influencer often required proving oneself on small and big screens. However, today, platforms like TikTok have provided a pathway for individuals to gain influence and build a following. So, the dynamics have changed a lot.
Q: What new trends in digital marketing are emerging?
A: A notable trend in digital marketing is the shift from big influencers to niche or city-centric influencers. Previously, pan Nepal influencers were prevalent, but now we see influencers catering to specific regions or sectors such as fashion, automobiles, or home groceries. This diversification of influencers allows for more targeted and relatable content through platforms like TikTok videos and reels. This trend has proven to be effective in reaching and engaging with specific audiences in the digital marketing landscape.
Q: How do you observe its current growth and what the future holds for influencer marketing?
A: Influencers in the past used to be prominent politicians and celebrities, thus the idea of influencer marketing is not new. But these days, content producers and influencers from digital platforms like TikTok are becoming more and more popular.
Additionally, small businesses now have more chances because of the rise of influencer marketing. Influencer marketing used to require firms to set aside large sums of money for influencers, but nowadays influencers come in different shapes and sizes. Influencer marketing is becoming more widely available and reasonably priced.
In the future, influencer marketing will still be very important to the advertising industry. To continue to be effective, influencers must stay in the spotlight, interact with their followers, and keep up with the newest fashions.
Q: How is Avani Advertising focusing on the digital sphere?
A: Avani Advertising is committed to keeping up with the latest trends and needs in the industry. As a part of the Avani group, we have various wings, including a digital wing, a BTL wing, and more. We continue to be heavily involved in traditional advertising, but we have also given the digital space a lot of attention. In the last 3-4 years, we have significantly strengthened our knowledge and proficiency in digital advertising. Our goal is to be efficient and competitive in all advertising areas, making sure that we satisfy our customers’ changing demands in the digital sphere and beyond.
Q: The government has recently banned the short-form video hosting service TikTok which has received both welcome and criticism. As a platform that was fast becoming a choice for advertisers, what impact this decision of the government will have on digital and influencer marketing?
A: The digital and influencer marketing environment has been significantly impacted by the recent ban on TikTok. It is regrettable, as the owner of an advertising agency, to witness the platform being blocked rather than having its shortcomings fixed. But now that the restriction is in place, people will start using other sites, like Instagram Reels or other platforms for short-form videos.
Influencers and companies will have to carefully adjust to the new channels and look into other options for their influencer and digital marketing campaigns. Platforms like Reels and YouTube Shorts can potentially fill the void left by TikTok. The industry will continue to adapt and discover new channels for influencer and digital marketing.
Q: Digital platforms and social media are effective in reaching out to a large audience. Has this diminished the prospect of traditional mediums such as print and television?
A: No, digital advertising is not replacing traditional mediums such as print and television; rather, it has complemented them. In the past, there were limited options like print media and a few television channels. However, with FM radio, multiple television channels, and the rise of digital platforms, the advertising landscape has expanded. Digital advertising has brought non-advertisers into the advertising industry and extended advertising reach even to remote areas. Digital and traditional advertising complement each other in reaching different audiences and achieving diverse marketing objectives. For example, even major brands like Amazon continue to advertise on television. Therefore, digital advertising has expanded the advertising industry rather than replacing traditional mediums.
