Uganda’s telecommunications companies are looking to advertising as a means of increasing their customer base, after price wars in the country saw massive shortfalls in profits late last year.
According to Synovate, a local research firm providing monitoring solutions for organizations and the marketing industry, in the first three months of this year, ad purchasing has increased by Shs18 billion compared to the same period a year ago.
Tarik Radwan, an Egyptian businessman in Uganda looking to invest in the telecommunications sector, said that this is a positive step in getting profit margins back “to where they need to be.” He added that “Uganda is a country on the verge of a major breakout in telecom and, with the price wars really hitting many companies hard, it is not surprising that advertising could bring in new customers and buttress those shortcomings.”
According to Synovate, industry exposure in the first quarter “rose to Shs97 billion compared to Shs79 billion in the same quarter of 2010.”
Speaking to reporters on Monday, the research firm’s country manager Virginia Isingoma Nkwanzi said that advertising is a vital component for these firms, especially “with huge election advertising expenditure,” referring to February’s general vote in the country.
“The current high commodity and fuel prices have not affected advertising in any way, instead expenditure on advertising has continued to grow,” she said.
There are worries that the rise in ad purchasing could lead to a new battle between telecom operators, but to date, it has not yet occurred.
By Staff
