Businesses terminate contracts with AAG over COVID-19


The Advertisers Association of Ghana (AAG) has revealed that businesses have terminated contracts with its members following the Coronavirus pandemic and its effects on the economy.

A statement by the AAG said most agents have moved their clients from bill board advertising to online platforms, adding that big and multinational companies which engage the services of these agencies have cancelled their contracts because they are mostly affected by the Covid-19.

“This season of COVID-19 has seen certain areas of advertising experiencing great results while some corners of the industry has been hammered.

“Agencies with high technological space, have moved their mandates to clients online, while the others struggle within the space of virtual advancement,” the statement said.

It added : “In view of this, several prominent events and conferences are being cancelled or postponed in an effort to protect the health of their employees and as a precaution on suggested travel restrictions, also existing contracts with businesses for the management of their advertising budgets for the 2020 fiscal year may be terminated or renegotiated for the simple reason that, production has gone down thereby impacting negatively on revenue as consumption and/patronage have gone down.”

“This obviously demands that advertising agencies re-look at the sources of cash inflows and revenue for their 2020 budgets because as health and safety concerns loom around large gathering, many businesses are abandoning live and in person upfront presentation in exchange for visual presentation,” the statement added.

It further notes that, should the pandemic persist, that could impact the advertising agencies revenue and profit.

“Huge drops will be seen in the revenue of advertising agencies because the big and multinational companies which engage the services of these agencies are mostly affected by the Covid-19.

“As a result, those companies will cut down on mainstream and traditional advertising, and rather resort to having an in-house advertising team, mainly as part of the marketing communication department,” it said.



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