Green Marketing Hits the Bottom Line

Don’t expect to see huge Calvin Klein Jeans billboards in Sao Paulo - or those from any other brand for that matter.

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RIO DE JANEIRO — Don’t expect to see huge Calvin Klein Jeans billboards in São Paulo — or those from any other brand for that matter.

Latin America’s largest city last year banned outdoor advertising in a bid to clean up the visual landscape, a move that’s caused fashion and other brands to significantly shift marketing strategies.

While many of the metropolitan area’s 18 million residents have applauded the cleanup, firms that sold outdoor space in São Paulo, including ad agencies and the owners of various outdoor locations, have lost about 300 million reals ($175 million) in annual revenue, according to Central de Outdoors, a nationwide group of companies selling ad space outdoors.

Before the law took effect 16 months ago, São Paulo, which accounts for 20 percent of Brazil’s gross national product, accounted for nearly half of the 650 million reals, or $380 million, spent in the country each year on outdoor ads.

“The law was good for the city, but it was bad for us,” admitted Gabriela Barcellos, marketing director at Calvin Klein Jeans in Brazil. “We lost a key component to our ad venue variety — the Calvin Klein Jeans billboard — which really helped spread our brand name.”

The so-called clean city law, which is the first of its kind in Brazil, was the initiative of maverick Mayor Gilberto Kassab, who wasted little time in proposing it after he took office in March 2006. The measure was passed by the state legislature in September 2006 and took effect Jan. 1, 2007. “São Paulo was among the most visually polluted cities in the world, and 70 percent of the outdoor media in the city was illegal,” Kassab said, referring to displays that exceeded size limits or evaded city permits and taxes.

“Ninety-nine percent of the outdoor advertising in the city has been taken down,” said Sérgio Rondino, head of the mayor’s press office. “Most of it was taken down voluntarily. In some cases [outdoor media owners] fought the law in court, some of them arguing it was unconstitutional,” Rondino noted. “The city won nearly all of those lawsuits and lost none. Some of those lawsuits are still in the courts, and while they are, the owners of the outdoor billboards and panels can still keep them up.”
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