New advertising agencies -- each making big promises -- seem to appear daily, and an industry with humble roots is now worth billions of naira. An advertising marketplace full of different offerings serves to drive prices down, and competition helps to keep agencies honest. On the face of it, companies and brands would seem to be in a fantastic position as a result.

However, advertising in Nigeria still faces serious challenges, which apply not just to the agencies providing the services, but also the brands that pay for them. Here is a look at the three largest of those challenges, and what they mean for the parties involved:

1. Nigeria still suffers from a slow economy

While the overall Nigerian economy -- Africa’s largest -- has benefitted from one of the fastest growth rates in the world, the majority of Nigerian consumers still have quite limited purchasing power. Estimates of the percentage of Nigerians living in poverty range from 30 to 50%. If cash-strapped consumers aren’t paying for products and services, the companies advertising them look for places to cut spending, and often, logically, question the effectiveness of the ad itself.

For advertising agencies, this presents the problem of creating immediate results for the brands they serve, which requires a high level of quality in ad design, placement, and overall strategy. Companies looking to successfully advertise their product, meanwhile, must identify and partner with agencies who understand this challenge and aim to overcome it by way of in-depth local knowledge of both audiences and infrastructure, and an intimate understanding of the brand and product.

2. A glaring absence of accurate media data

Tens of millions of Nigerians use smartphones, social media, and e-commerce sites daily, and that number is only growing. When it comes to tracking consumer trends and choices, data abounds in Africa’s biggest economy. However, data about media itself is far more difficult to find -- and where it can be found, it is still often unreliable.

What media should ads be placed in? Are they being looked at? These are the most basic kinds of questions that are difficult to answer without proper data analysis.

The problem originates from a shortage of media intelligence providers in Nigeria and results in the inability to advertise cost-effectively. To be genuinely successful, advertising agencies must spend the necessary time and resources to perform media monitoring and analysis themselves. This is a daunting task in a multi-language, multi-dialect country like Nigeria.

What this means in practice is that brands must partner with advertising agencies that not only grasp the depth of this problem but which also have the extensive pool of resources needed to manage it and achieve results.

3. Too few ‘true experts’ in the field

To paint a clear picture, Nigeria has been ranked as low as 171st in surveys measuring the health of countries’ investment in education. Many of the statistics that factor into such rankings deal with primary education. Still, it’s not difficult to see that secondary education -- the kind needed for careers such as marketing and advertising -- is affected as a direct result. There are currently very few universities in Nigeria that provide training in the knowledge and skills that are required of marketers and advertisers. And unfortunately, they are financially off-limits for much of Nigeria’s population.

For both advertising agencies and companies looking to advertise their products, the implications are obvious; the challenge for agencies lies in successfully competing for the limited pool of local experts, while the challenge for brands lies in identifying which agencies have managed to do so.

The bottom line for Nigerian advertising

Disparity in microeconomics, uncertain data and a shortage of expertise in the field are three factors that compound each other in the advertising industry. Successful advertising is certainly possible; it’s just a matter of understanding the obstacles and having the resources to navigate them.

Overall, advertising has a bright future in Nigeria. The economy is packed with consumers who both want and need products and services that will improve their quality of life. In part, this is why we have seen such a proliferation of advertising agencies. To the extent that these agencies can learn to thrive in our country’s unique economic ecosystem, it will serve as a sign of more good things to come for all Nigerians.

Seyi Tinubu is an entrepreneur, father, and husband to the most loving wife, Layal Tinubu. He is the CEO of an out-of-home advertising company, Loatsad Promomedia Ltd, Patron to STL Polo Team, and Member of the Board of several organisations. With impacting the lives of the rising youth in Nigeria at heart, Seyi and his wife created the Noella Tinubu Foundation to empower, provide mentorship, and support families & business start-ups.