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 yesterday.

Kim Eng Securities Thailand, quoting figures from a recent survey by Nielsen Media Research, said alcohol commercials generally accounted for no more than 4 per cent of all advertising revenue of each medium. However, the revenue from alcohol ads in cinemas accounts for 14.6 per cent 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 10pm and 5am.

Work Point, a listed production company, may be affected because two of its programmes depend on alcohol advertising, accounting for 3 per cent of the company's total revenue from television shows.

Advertisers, meanwhile, said the interim government's plan to ban alcohol commercials around the clock may not result in a decline in consumption. Instead, the companies would likely shift towards price-cutting to boost sales.

They said the government should campaign for responsible drinking instead.

Witawat Jayapani, president of the Advertising Association of Thailand, said that at present the alcohol companies spent about 30 per cent 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 at selling points to connect with customers.

Alcohol producers spend about Bt2.6 billion on advertising each year. Therefore, the advertising companies are likely to lose Bt600 million to Bt700 million of income in the current quarter if the ban is imposed.

Public Health Minister Mongkol Na Songkhla said on Thursday the ministry was considering a law to ban alcohol commercials 24 hours a day.

However, advertisers treated the plan with scepticism, saying such a ban would instead give foreign companies an edge over Thai rivals because it would be difficult to extend the ban to commercials through cable and satellite media, such as advertisements that come with live football matches from overseas.

Witawat said the ban would not effectively reduce alcohol consumption because alcohol ads are usually not a hard sell for the product, but rather designed to promote a company's corporate image.

Witawat expects that this year, the overall advertising industry will enjoy no growth because of the political situation and overall economic conditions.

Panya Pongphanya, general manager of Thai Asia Brewery, which distributes Heineken and Tiger beer, described the proposed measures as "too drastic, giving Thailand some of the world's most rigid regulations in the same way as Muslim nations".

Boonchuay Tongcharoenpulporn, secretary-general of the newly formed Federation on Alcohol Control of Thailand, said that at a meeting with operators and sellers yesterday, participants had agreed that an advertising ban would not result in declining consumption but would cause economic damage.

He said on Tuesday that the federation would submit figures to economic ministers and the deputy prime minister on the potential financial damage.

He added that these companies, which properly pay taxes, should not fall into a defensive role in society. He suggested that instead the government should control the ethics of drinkers by setting up a joint committee among non-government-organisations, and government and private sectors, to work out measures to promote responsible drinking.

Boonchuay said research by Mahidol University showed there is no direct link between advertising and consumers' decisions to drink. Instead, consumption of alcohol is related to interaction with friends and other social factors.

"We think that it is important for the government to consider all aspects of these issues and act accordingly," he said.

Piti Bhirombhakdi, advertising manager of Singha Corp, said it was too early to assess the likely impact on the industry and the company, but he said the Public Health Ministry should carefully consider the impact of the proposed measures.

He said the government should focus on a campaign to promote responsible drinking. Piti said advertising is not the main factor promoting drinking, citing white liquor, which sells well because of the pricing factor.

"The government could introduce other measures such as including graphic pictures on the bottles, in the same way as cigarette packets," he said.

Phatra Securities said the impact would be mixed. The ban would keep new competition from gaining a market share, allowing existing brewers such as Thai Beverage and Singha to continue enjoying dominant market positions, but the impact on the alcoholic demand could be modest.

The research cited white spirits, the low-end segment of the liquor market, that have seen sales increases in spite of the lack of advertising.

Kwanchai Rungfapaisarn

The Nation