Production of advertisements abroad, especially in the United Kingdom (UK) and recently in South Africa by various Nigerian companies, has been described as a leech on shareholders’ fund.
Informed sources familiar with the development accuse officials of indigenous firms, their agencies and foreigners of collaborating to rip company shareholders off by shooting or finishing advert productions abroad when same could have been successfully done here (Nigeria) at a much lower cost.
The implication of this development, sources say, is capital flight from those companies and Nigeria, both of which are in dire need of funds for development.
Capital flight in any form, especially from developing economies, lowers economic growth, because investment is said to be what generates the necessary growth and employment in any economy.
According to a source, “The foreigners encourage Nigerian companies, even to the point of bribing them, to come for advert productions because they are the ones benefiting. Shareholders see these adverts but do not ask questions on the cost implications of such productions because the expenditures are usually buried in operational costs.”
Another dependable source in the advertising industry, whose major clients had severally shot adverts abroad, estimates that Nigerian companies spend $100 million (about N15 billion) annually to produce their television campaigns abroad.
Meanwhile, a senior staff with the Advertising Practitioners Council of Nigeria (APCON) told BusinessDay that the advertising reform committee, established by the council, is examining the possibility of discouraging companies and advertising practitioners from shooting adverts abroad.
“The committee had at its last meeting invited some sectoral groups to find a way out of this challenge,” he said.
Victor Okai, a film producer, estimated that the average cost for advert production abroad is over N70 million. He however pointed out that some firms could achieve their objective with something more or less than that figure.
Many companies in various sectors, including banking, telecom, manufacturing and services have had their adverts shot overseas or sourced their consultancy services abroad with huge amounts of money paid for the job.
Okai dismissed the excuse on lack of equipment and good sites often tendered by some agencies and clients for shooting adverts abroad, clarifying that before now, such an excuse could be admitted but “in recent times, people have invested heavily in equipment for productions and post-productions. But what we find is that agencies insist that the job has to be finished in South Africa or the UK.”
He stated that the agencies, which survive on commission, would not justify huge budgets if they produce the commercials in Nigeria. “Sometimes, they need to build the cost for commercials big because that is what the client is looking for. The clients think it is better when commercials budget is huge.
“When you tell clients that a commercial can be done for less than N3million, the figure will not impress them. There are some officials (on the client’s side) who also want to travel for advert productions; so the agent builds the budget huge enough to accommodate all this, but the agent knows he can finish the job alone without the client or agency person being there,” Okai said.
He expressed regret that the cost of one commercial shot abroad can produce 10 home videos, pay all the big stars in it and still save money.
“Although globally, quality commercials are expensive, there is no place in the world where a commercial costs more than a movie,” he noted.
Okai, who also runs a film academy, traced the habit of shooting adverts abroad to the 1970s and 80s when a lot of advert films shot for multinationals were usually done abroad and in the multinationals’ countries of origin.
“If a local producer shot films here, the creative managers from the agency would travel with the producer abroad, especially to the UK which was one of the principal destinations at the time to do post-production. This is a bad habit that has stuck. But now, we can do post-productions here in Nigeria at whatever level,” he further explained.
The film producer was not, however, much worried about Nigerian artistes producing their videos abroad, observing that they are spending their money. “It is about glamour,” he said.
Dora Akunyili, former minister of Information, once drew the attention of advertising stakeholders to the risks of shooting adverts abroad. She had advised the industry on ways of generating more revenue by using local creative energies in Nigeria.
“Instead of rushing to South Africa to produce adverts at often exorbitant costs which leave the industry losing, it must fashion out ways in which advert agencies that employ the creative talents in Nigeria will get support and those that still decide to go overseas will have to pay a price,” Akunyili said.
For the industry to survive and thrive, it must fashion out administrative guideline that will make adverts produced overseas unattractive, she further observed.
Kelechi Nwosu, managing director, TBWA/Concept, who agrees that capital flight is the repercussion that follows going abroad for adverts, says most firms shoot advert overseas due to absence of appropriate facilities and talents for excellent production.
He further states that there is the need to encourage Nigerian firms to look inwards for their adverts.
A senior member of the Advertising Agencies Association of Nigeria however said the association did not have an official position on where members could shoot their adverts.