Business
East Africa: Booming economies, a market worth $1 billion, attracts global ad agencies
(Reuters) – The arrival of global advertising agencies has raised the stakes in east Africa’s US$1 billion market, with new players hoping to wrestle a piece of the action from the Kenyan company Scangroup, the regional leader.
French-based Havas Media International and South African media group Carat, a unit of Aegis Media, are also angling for a piece of the action in a sector fuelled by a fast-growing middle class in Kenya, (the largest economy in east Africa).
Kenya’s advertising market accounts for over half the more than US$1 billion annual revenue in the region, according to research firm Ipsos Synovate.
Tim Smyth, chief executive of TBWA, a unit of U.S. group Omnicom, is headhunting local talent to help set up shop, igniting a bidding war with other new entrants.
“It is a bit challenging to break into a market with a dominant player. But we believe we have the capacity and experience to do so,” he told Reuters.
Smyth was referring to Scangroup, the only listed marketing and advertising company on the Nairobi Stock Exchange.
Scangroup has gobbled up smaller firms and struck partnerships to help it ease into new markets, putting it in pole position in sub-Saharan African economies.
