Closing the gap in the MENA TV Market.

With a population almost comparable to the United States and an economic size in the same order of magnitude as Germany, the Middle East and North Africa region should constitute an attractive region for investment in television advertising. But analysis by Oliver Wyman reveals a significant gap between what should be the investment level by advertisers and the actual level.

In fact, when compared against benchmarks with peer regions, MENA falls far short of its potential. The less than USD $2 BN overall advertiser spend in the region puts the MENA TV ad market at 30% of the “fair” estimates, considering the regional GDP. This shortfall puts serious constraints on the economics of the market players, given that less than 10% of all MENA broadcasters capture about 80% of the advertising spend; more than 500 FTA pan-Arab channels share the remaining 20%.

The MENA TV market suffers because advertisers and networks cannot manage what they cannot measure. Without reliable audience measurement systems that track and report viewership on each registered channel on a minute-by-minute basis, market players cannot identify and reward the quality and creativity of content production and realize the economic opportunities offered by network advertising. In advanced TV markets, systems like People-meters have sparked a flourishing business, focusing attention and providing actionable metrics.

Oliver Wyman analysis of data drawn from the People-meter system recently introduced in the UAE (tview) indicates that ad spend allocation, program selection, and content creation decisions driven by real metrics could enable a paradigm shift in the TV industry in the MENA region.