4.

Placement Experience - Theory and Practice

4.1 PESTLE Analysis of the Nigerian Business Environment:

Political:

In March 2015 Nigeria underwent presidential elections which flowed seamlessly in

The new president Buhari was trying to crackdown on corruption in Nigeria because
this is quite a problem at all levels in the Nigerian society. The Nigerian government
body; the EFCC ( Economic and Financial Crimes Commission) was tasked with
bringing to light economic crimes by people in Nigeria especially at the higher levels
of society.

The effect this had on the advertising industry was that because people were
looking to not spend a high amount of money so as not arouse suspicion
companies who usually have lavish events cut down on spend because people
would not spend.

Economic:

The major cash cow in Nigeria is the exportation of crude oil however when crude
oil prices began to drop it significantly affected the economic stability of the country.

Work was made difficult because dealing with the client in developing television
adverts for our clients as well as the company who helped us with the production of;
both these companies were based in South Africa. The companies expected to be
paid in US dollars and expected a deposit before they began working. This meant
that the price would go up because of the valuation of the Nigerian Naira against
the US dollar.

This also affected other companies because they had an obligation to pay both the
foreign investors annually, as well as suppliers for events. These were both costs
that could not be alleviated however because they had foreign affiliates they were
able to work around this in order to pay what they had to pay. Also, working for
multinational clients meant that they could use this as a route to pay foreign
payments, increased cost was still however a factor.

The economic recession also meant that people/ corporations were reluctant to
spend money in Nigeria as companies put in extra effort into making a high amount
of money and spending as little as possible. In line with trying to meet our yearly
targets was unable to drop their margins by a certain percentage so this meant that
the company lost a number of pitches because their margins were too high. Clients
lack of willingness to spend large amounts of money meant that the dome (an
inflatable structure the company bought to create differentiation for our activations)
was not utilised and as such was not money well spent; it was only used once.

Social:

The economic effects trickle down to the social effects on the business. The
restructuring of businesses due to economic instability meant that there was a high
turnover in companies.

As stated earlier when companies are cutting down on their budgets the first cut is
usually in the marketing department. This meant that in-house things became quite
cut throat and people are focused on protecting their jobs because they are aware
things can go south at any moment. This was very as people were very reluctant to
delegate because they wanted to be assumed to be adding value to the company.

On the other hand the effect of the high employee turnover was such that employee
morale was low because they were uncertain of their future at the company. This
became even more apparent after the employee disengagement exercise where a
large number of employees were disengaged with lieu of notice. A high number of
employees who stayed on began looking for work elsewhere and many left the
company as the fiscal year ended.

The presence of Boko Haram in Nigeria meant that companies there was a higher
risk whenever the agency had to complete an activation in the Northern regions of
Nigeria. This meant that employees were reluctant to take part in said activations
and so were suppliers. In order to curb the problem on the employee end the
amount of activations were reduced and they made sure to only send indigenous
people to these regions (which may pose a problem if said individual in not
experienced in relevant subject matter). On the issue of suppliers the agencies had
to create a database of suppliers in the regions which they intended to activate in,
which would be a problem if they did not already have them.

Technological:

Advancements in technology worldwide and the growth of the social media space
meant that companies looking to engage a wide demographic through higher
involvement in the social media space as well as integration of the same into
company practices.

In the case of one org their social media presence was next to none and the social
media platforms where they were present were very inactive. This was an area
where they did need to place some attention because of the nature of their work as
well as the fact that other key players in the industry are capitalising on the same.
One of the initiatives I did attempt was to get them to move in that direction which
did not work out too well, however towards the end of my tenor there they did hire a
digital expert to head the department.
Before my arrival at one office they were working with a digital agency however
they did not resume in January. However, we did use technology as part of many of
our activations in order to keep up with the times and the work of other agencies;
examples of this can be found in the portfolio of evidence (presentations).
Technology also played a part in the communication within the company as there
were two WhatsApp groups.

Legal:

The Central Bank of Nigeria under a directive from the President meant that there
was a limit on the amount of Forex that could go in and out of the country under a
policy named Buy Nigeria. This falls under political, economic, and legal factors
that affect the business environment however, because it is under policy I thought it
would primarily be a legal factor. The effect this had was that it then became difficult
to pay foreign supplies and this affected companies because as discussed earlier
both companies had foreign affiliates and in the case of investors whom they were
obligated to pay. The solution was that the payments were made multiple times in
smaller increments which inevitably increased the overall cost to both companies.