Challenges in the TVC Industry
As I write this we are exiting ‘Grey May’ as it is sometimes referred to. The time of year that neither contains the vibrant colours of autumn nor the crispness and excitement that winter’s snow brings. It’s usually a time when work slows down and locals go on holiday or just chill out following the busy summer season. This year has been different, and not in a good way. While the summer has been at capacity for tourism, registering unprecedented numbers, our traditional primetime for the TVC industry has been quiet – very quiet.
The feature film market feels fairly strong for the country and we recently had Pork Pie travelling through Otago and Southland and Sir Ridley Scott bringing the Alien franchise to Milford Sound. Both of these are fantastic projects in their own right and result in a variety of benefits, but in a region that is reliant on the TVC industry it doesn’t make things right. It dawns on me that a couple of years ago, when the feature film industry was imploding, things were fairly rosy down here as the TVC market remained strong. This demonstrates the risk on being too focused on a single market.
Recently things have not been good and we are trying to figure out why. I have been speaking with crew, producers, directors and overseas film commissions and contacts to try to find out the following:
- Is this the end of the TVC industry as we know it?
- Will the GoPro and D5 generation make the established industry obsolete?
- Is the rest of the world busy and NZ has just gone out of favour?
- Or is it specifically South Africa, with its low Rand and overall cost the reason?
- Is the current boost in tourism putting pressure on the price and supply of accommodation, and going to price us out of the market?
Rather than me speculating further I went to the source of what is suspected to be a major contributor to our slowdown. Bobby Amm, head of the Commercial Producers Association of South Africa (CPASA), was kind enough to provide her perspective and here is what she has to say:
The local (domestic) market is very slow and has been since the beginning of this year. Producers up here are looking very worried. The reasons cited are: loss of work to in-house production companies established by advertising agencies, the looming recession and, to a lesser extent, reallocation of budgets to focus on alternative media.
The service industry has been incredibly busy (and chaotic) this season. The main reason is the Rand, of course, which has made it almost 30% cheaper to film here.
The exchange rate is a bit of a double-edged sword for our industry – on one hand, it makes South Africa very attractive to foreign clients but on the other it leads to price increases that put pressure on our local industry and are generally unsustainable in our service sector, particularly if the currency recovers. We saw this in 2005 where it was extremely difficult to get suppliers to cut back in order to attract work when the Rand strengthened considerably. It’s a tricky balancing act.
We had a meeting last week with the Creative Circle (an association which represents creative directors). Their take is that there are big changes coming and this will mean a shake-up for both agencies and production companies. I can see that our members (particularly in the local market) are going to have to diversify quite a bit if they are to remain competitive.
It’s good to get this global perspective and give us in NZ something to ponder. I hope that by the time this article hits the press we will see a positive and busy winter season on the horizon.
Kevin Jennings, Queenstown branch member
