Roundup: Planned ban on alcohol ads raises worries among industries

The plan to impose a complete ban on alcohol advertisements in all media as proposed by Thailand's new interim government has incurred worried voices from industries concerned, Thai media reported.

Advertisers said it would hurt the industry's benefits, while its designed effect of discouraging alcohol consumption remains doubtable. Brewers and media shared the worries.

Thailand's newly-appointed interim Public Health Minister Mongkol Na Songkhla, said on Thursday the ministry was considering a law to ban alcohol commercials 24 hours a day, and he expected the new law could be announced within two weeks and would come into effect once it is published in the Royal Gazette.

Similar to an already instituted prohibition on cigarette and tobacco advertisements, the new ban would not permit ads for alcoholic beverages on television or radio, print media, or in posters and billboards.

Supporters said it is a good deed as drinking harms people's health. However, according to Witawat Jayapani, president of the Advertising Association of Thailand, the prospective ban would cause a big decline on advertising revenue.

As alcohol producers spend about 2.6 billion baht (70 million U. S. dollars) on advertising each year, the advertising companies are likely to lose 600 million baht (16 U.S. dollars) to 700 million baht (19 U.S. dollars) of income in the current quarter if the ban is imposed.

Witawat said the ban on alcohol ads will also hurt local player 's competitiveness vis-a-vis foreign entrepreneurs because it would be difficult for the government to extend the ban to commercials of foreign brands reaching viewers through cable and satellite media, such as advertisements that come with live football matches from overseas.

He said the government should rather give more focus to the internet as well as SMS messaging which can easily reach young people but is difficult to control. Also, the new law should impose a severe punishment on drunken drivers.

Advertisers have also doubted the plan's effects, saying that it may not result in a decline in alcohol consumption, as the companies would shift towards price-cutting and other promotion schemes to boost sales.

Witawat said that at present the alcohol companies spent about 30 percent of their budgets on advertisements. If they were ordered not to spend the money on commercials, they would probably use the budget to reduce prices and employ give-away tactics or other activities to attract customers.

Panya Pongthanya, general manager of Thai Asia Pacific Brewery, which distributes Heineken and Tiger beer, described the proposed measures as "too drastic."

He forecast that beer sales later this year will drop 5 percent to 10 percent, adding that it would be the first time that beer sales would decline during beer festival which is organized every cold season in Thailand. No advertising, he said, makes it practically impossible for new brands to enter the Thai market.

Local brewers may also decide to divert their investments to overseas project, Panya said.

Meanwhile, researchers said that rather than other media, Thailand's cinemas will be hit hardest if the ban is put into effect.

Beer, spirit commercials account for 14.6 percent of all advertising in Thailand's theaters. Companies such as Major Cineplex and EGV are likely to feel the pinch from the prospective ban on alcohol advertising, because the proportion of alcohol commercials in cinemas is higher than in other media, research companies said.

Kim Eng Securities Thailand, quoting figures from a recent survey by Nielsen Media Research, said on Friday alcohol commercials generally accounted for no more than 4 percent of all advertising revenue of each medium. However, the revenue from alcohol ads in cinemas accounts for 14.6 percent of the total for that medium.

Alcohol commercials on television networks account for a small portion of total TV ads because their air time has been limited to between 10 p.m and 5 a.m.

Source: Xinhua