Foreign firms, with their deep pockets, cornered a lion's share of advertising on television, with their local rivals, especially small and medium-sized ones, unable to match them in the spending stakes.

Despite the economic slump, advertising revenues saw strong growth in the first nine months, rising 16 percent to nearly 600 million USD.

TV ads, mostly by multinationals, accounted for over 500 million USD.

A recent poll by market researcher Kantar Media Vietnam found that in the period only seven Vietnamese brands figured in the list of the 20 biggest spenders.

Luong Van Vinh, general director of My Hao Cosmetics Company, said his company has chosen to expand its distribution network and virtually did not advertise due to high cost.

Trinh Chi Cuong, director of Dai Dong Tien Plastic Company, agreed saying that most SMEs are reluctant to advertise on TV due to the costs.

A 30-second spot normally costs 30-35 million VND (1,427-1,665 USD), he said, adding that a campaign will only be effective if the advertisement appears frequently on TV.

With their ability to spend millions of dollar on ads, a figure that local companies can only dream of, foreign brands have gradually taken over the market from local businesses.

One shampoo manufacturer, for instance, spent 8.1 million USD on TV ads in the first nine months, Kantar Media found.
At a time when local businesses are forced to cut costs, an international shampoo manufacturer has increased its spending on TV ads 10-fold to nearly 5.7 million USD.

The domestic food sector have been the worst affected.

Luu Duong, chairwoman of the HCM City Sauce Club, said with the big players' massive spending on TV ads, many small sauce producers have seen their market share shrink, with some even going bankrupt.

After the 2008 scare when the toxic 3-MCPD asfound in soy sauce, small businesses have updated technologies and production lines, but were still unable to attract consumers because they could not afford ads to inform them of the changes , she said.

Ngo Thi Hoang Mai, deputy general director of Lien Thanh Fish Sauce Co, said the company had recently decided to run a six-month TV ad campaign until February next year at a cost of hundreds of millions of dong.

Giant foreign firms spend that amount in just a few days but her company has to consider it very carefully, she said.

The director of another food processing company said every time the company launches new products, it also thinks of running TV ads but is unable to afford it.

The company instead has to depend on inviting shoppers at traditional markets and supermarkets to try its products, he said.

Some domestic firms manage to reach their customers directly through promotion programmes, and so focus on displaying their products at supermarkets.

They strengthen their distribution system and increase their sales staff and margins for agents.

Vinh of My Hao Company said after a year of not advertising on TV, the company has recently run commercials on provincial channels since they cost less than in big cities.

Some other companies too have chosen this route, especially since it allows them to reach rural consumers./.