Hong Kong

Ad firm sees Olympics as games of profit

By Jonathan Yeung (HK Edition)
Updated: 2006-07-28 07:11
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The mainland's largest outdoor advertiser Clear Media will use the 2008 Beijing Olympic Games as a big momentum to pump up its profits.

"The Beijing Olympics is a golden chance for us to grow further," Clear Media's CEO Han Zijing said yesterday, the day the company announced that its first half net profit in 2006 had jumped 14 per cent year on year to HK$42 million.

"Because of the Games' long-term influence both in China and overseas, we hope to generate more revenue not in 2008 only, but also before and after that," Han said.

Clear Media is in talks with five of the ten major Beijing Olympic Games sponsors, he said. And "we expect to strike the advertising deals with them in the near future".

The company, operating in 30 key mainland cities, is about to launch its Olympics advertising package. "This multi-year package will span from 2007 to 2009," Han said.

"The earlier our customers subscribe to the package, the less they will be charged." This will allow them to save on costs that the Beijing Olympics is sure to shoot up, especially during the one-month-long grand event.

To build up the momentum for the package, Clear Media acquired 634 bus panels in Beijing this June. "We expect the total number of bus panels controlled by our company in Beijing to exceed 6,000 by 2008," Han said.

"The more panels we have, the more revenue we are likely to generate later." His company's sales from bus panel adverting in Beijing could be "millions" of yuan a year from 2007 to 2009.

As Clear Media's core business, bus-stop advertising continued to contribute satisfactorily to its total turnover.

In the key cities of Beijing, Shanghai and Guangzhou, the company's first half turnover from bus-stop advertising was HK$180 million, 13 per cent up from the year-ago period. And in mid-tier mainland cities, its turnover from bus-stop advertising rose 9 per cent to HK$156 million.

Hence, the jump in its net profit was largely attributed to the rise in its bus-stop advertising.

The company's sales from airport advertising, point-of-sales and other advertising formats surged too, from HK$3.6 million to HK$12.4 million, pushing up its total turnover to HK$348.4 million, an increase of 14 per cent year on year.

Clear Media will try to generate more revenue in the second half, chairman Steven Yung said. "Since the second half is usually the peak advertising season, we expect the positive consumer advertising trend to continue."

Clear Media has already increased its average selling price by 15 per cent compared to last year.

(HK Edition 07/28/2006 page3)