Businesses now more leery of govt help

The Nation (6 December 2007)

Businesses now tend to rely entirely on themselves rather than pinning their hopes on government policies and efficiency after experiencing political instability for the past 18 months, says Chaipranin Visudhipol, chairman of advertising agency TBWA Thailand.

This will eventually result in the Thai economy being driven entirely by the private sector rather than the government, unlike in the past, he said.

Many businesses do not have much hope for either the present government or the next government after the December 23 general election when it comes to a recovery of the economic situation next year.

He said businesses could not keep waiting for future external relief.

Instead, they have started focusing entirely on their operations and marketing and gradually forming groups for cooperation to increase business.

One example is the improved performance of many companies this year despite the political uncertainty.

He also suggested marketers find new ideas and new markets to penetrate.

"If they keep selling old things, they'll achieve only short-term success. A clear example is a new segment in the property industry that has emerged this year: the inner-city condominium," he said.

He said the outlook would be stronger next year, with businesses deciding to survive entirely on their own, although that would not have a big effect on the entire economy yet, because there were still many companies that had to adjust themselves to shar-ing and cooperating with others.

"Thais like to work individually. Many still find themselves uncomfortable sharing information and working together with others," said Chaipranin.

Therefore, the changing outlook does not mean a positive change for the advertising industry yet.

Advertising spending by those companies will not improve from this year for some time. Meanwhile, businesses no longer feel any difficulty in dealing with many negative factors that they have been facing since last year.

However, Uefa Euro 2008 and the Olympic Games will partly drive ad spending.

He said there was a possibility for the industry to reach Bt100 billion in value next year, from an estimated Bt90 billion this year, although the value would not be achieved by real demand in ad spending.

Instead, increasing airtime, known as media inflation, in many media channels will be a key factor. Chaipranin predicts media inflation will rise 5 per cent on average next year.