Marketers will have to adapt to stricter industry rules

The Advertisers Association of Nigeria, ADVAN, recently penned an open letter to President Bola Ahmed Tinubu, launching a scathing attack on the Advertising Regulatory Council of Nigeria, ARCON, which warrants a response to set the record straight.

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In the letter, ADVAN claimed that since 2019, advertisers have consistently raised concerns with relevant authorities about ARCON's operations, citing arbitrary regulation, unclear processes, and enforcement practices that undermine business confidence.

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ADVAN also stated that the introduction of the Advertising Industry Standard of Practice, AISOP, in 2022, which regulates private entity contractual agreements, has led to a reduction in advertising activities and spend, rather than fostering balance, innovation, or growth.

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According to ADVAN, the impact of ARCON's actions is now visible and measurable, with advertising spending having dropped sharply, brands reducing or canceling campaigns, and some companies exiting the Nigerian market or reconsidering future investments.

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It is noteworthy that ADVAN had already taken ARCON to court, filing several lawsuits to challenge the advertising industry reforms and the constitutionality of ARCON's oversight functions.

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In response to the letter, ARCON stated that the issues raised are already part of the cases pending before the Federal High Court for determination, and therefore, subjudice, making it unnecessary to take the matter to the media.

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ARCON accused ADVAN of spreading misinformation to obstruct and halt the ongoing advertising industry reforms, which are part of the Renewed Hope Agenda of President Bola Ahmed Tinubu's administration.

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The Minister of Information and National Orientation, Alhaji Mohammed Idris, had directed all government agencies under the Ministry to adopt the Nigerian First Policy and embark on reforms to promote inclusive growth.

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ADVAN's claim that advertising spend is shrinking due to over-regulation and harsh policies of ARCON is misleading, as the association's real intention is to avoid any form of regulation, which would be detrimental to society and the public.

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ARCON discovered that some advertisers outsource the use of talent in advertisements targeted at the Nigerian market, using foreign models and voice-over artists, and productions are often done outside the country, denying Nigerians and the Nigerian economy the benefits of advertising income.

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ARCON directed that all advertisements targeting the Nigerian market must use Nigerian talent and be produced in Nigeria, except in circumstances that do not permit this, which did not sit well with some ADVAN members.

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Nigeria's creative industry has evolved significantly, and the government's 'Nigeria First' policy has been beneficial, making it surprising that ADVAN is opposing this policy.

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ADVAN's actions raise questions about whose interests they are protecting and whether there are underhand deals involved in doing productions outside the country.

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Media debt is a significant problem in the Nigerian advertising industry, with ADVAN members owing media houses billions of naira, an issue that ADVAN does not like to discuss or handle with urgency.

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ARCON was forced to seek the intervention of the Economic and Financial Crimes Commission, EFCC, to address the issue of media debt and adopted the 45-day payment cycle as recommended by the Advertising Industry Standards of Practice, AISOP, Committee.

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ADVAN lobbied ARCON to suspend the payment threshold policy, allowing its members to conduct business without adhering to the payment policy, which ARCON refused, leading to accusations of over-regulation.

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Ironically, ADVAN members often prepay foreign media houses but owe local media houses with impunity, highlighting the need for regulation in the industry.

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ADVAN raised concerns about the constitution of a Board for ARCON, which they claim is necessary to oversee the activities of the body and ensure it is subjected to regulation.

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However, ADVAN had pulled out of the Heads of Advertising Sectoral Group, HASG, platform and declined participation in the National Advertising Conference and the Advertising Industry Colloquium.

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ADVAN has a representative on the Advertising Standards Panel, ASP, which is responsible for vetting advertisements, and yet they complain of non-inclusion and want ARCON to suspend the advertising industry reforms as a condition for participation.

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The claim that advertising spending is shrinking is not a significant concern, as the traditional media no longer controls advertising spend, and the new media has taken over, making it essential for industry players to operate with some measure of control and regulation.

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ADVAN must review its engagement with other stakeholders in the industry, as even a thousand open letters to the President won't change the need for regulation in the advertising industry.