Bisnis Indonesia - Bisnis.com

JAKARTA: The government's plan to increase fuel price may push down the advertising expenditure, as public consumption is expected to decline.

The Association of Indonesia Advertising Companies (PPPI) projected advertising expenditure this year will only IDR90 trillion, or grew 12.22% from last year of IDR80.2 trillion. Without increase in fuel prices, the growth of advertising spending is estimated at 14%.

Chairman of the Association of Indonesian Advertising Companies (PPPI) Harris Thajeb said the drop in production would make the company to improve efficiency, such as cutting on campaign cost.

"The budget for advertising is definitely suppressed. With an increase in fuel, we had anticipated this year’s advertising expenditure may not be as good as last year in terms of growth, "he told Bisnis yesterday (Wednesday, March 14, 2012).

On that basis, PPPI projects advertising spending this year will be only IDR90 trillion or will increase of 12.22% from last year of IDR80.2 trillion. However, an increase in fuel prices, the growth of advertising spending in 2012 is expected to reach 14%.

Nevertheless, Harris hopes the company will not cut the advertising budget on a large scale to maintain the market share of their products.

President Director of PT Dentsu Indonesia said the dominance of ad spending pie this year retained after the television media captured 68% of total ad spending last year.

The next portion was newspaper, reached approximately 20% and the remaining was contested radio, magazines, digital advertising and outdoor media.

Nielsen’s data shows Indonesia telecommunications sector is the biggest shoppers in the 3Q/2011 or increased 89%, compared with the position in the same quarter last year. (K16/T03/NOM)