by Daniel Dombey
If you want to see what a booming economy is like, look up at an Istanbul billboard. Like Turkey as a whole, the city is brimful with publicity – for luxury housing developments, flights across the world and the latest Apple products.
But in an uncertain 2012, there are signs that the advertising bonanza – which is still modest by standards elsewhere – may not expand so quickly in future.
According to the Turkish Association of Advertising Agencies, the country’s media advertising market is set to grow 15 per cent this year over last year’s total of TL4.3bn ($2.4bn). That’s after growth rates of 20 and 31 per cent for 2011 and 2010 respectively.
Over 55 per cent of all advertising in Turkey is on television with the press representing 24.5 per cent, the internet 8 per cent and the omnipresent billboards 7 per cent.
The Association of Advertising Agencies describes its prediction for this year as “optimistic” and – showing it is unafraid to state the obvious – points out that overall growth and Turkey’s high level of economic activity are the real drivers of the country’s advertising. Of course, the consumer boom that has helped stoke growth of more than 8 per cent in recent years has everything to do with Turkey’s aspirational adverts.
Things are finely balanced however. The Turkish central bank said on Wednesday that it expected that the economy would easily meet the government’s 4 per cent growth target for this year, despite a marked slowdown in economic activity at the start of the year which may see growth flat for the first quarter.
The big risk is in the oil price, which is particularly skittish because of the tensions over Iran’s nuclear programme and to which Turkey, as a large scale energy importer, is particularly vulnerable. A big jump could stoke inflation that is already above 10 per cent a year, leading to higher interest rates, with all that means for economic activity – and indeed Turkey’s spate of ever slicker ads.
via Turkish advertising: boom or bubble? | beyondbrics | News and views on emerging markets from the Financial Times – FT.com.