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Sabesp | The Ad as Political Launching Pad


Source: Rede Brasil Atual

Despite recent street protests demanding improvements in public services, subsidies for public transport, an end to high tolls and fines, and strong measures against corruption, governor Geraldo Alckmin (PSDB-SP) seems to enjoy living dangerously, to the point that he feels he can defy popular dissatisfaction.

Sabesp, owned by the state government, recently completed a public auction for  a R$ 87 million publicity campaign -– market rumors say that the ad spending of the company will run to  R$ 120 million this year.

The problem is that the company has a captive clientele and maintains a monopoly over the area of its concession. That is to say, it does not need to promote itself as if it were a soft drink.

Advertising Sabesp is useless in the selling of its product: water and treated sewage. For that reason, there is no item on the state budget more worthy of protest than this. It would be much more useful and necessary to use this sum to reduce the monthly water bill or invest more in its own water supply and sewage treatment.

As I recall — and I do not recall very clearly, sorry — Sabesp is interested in a strategy of expansion — selling its proprietary tech to other operators around Brazil, and even abroad — that might explain this approach to advertising. On the other hand, if you have driven on the Tietê or Pinheiros beltways recently, the persistent stench still makes you wonder whatever happened to that Big Dig clean-up you used to read about ….

At any rate,,Sabesp sometimes behaves as though it wants to become something like the Odebrecht of sewage.

The current campaign is reminiscent of what PSDB governor José Serra did. In 2009, a pre-election year like the present one, Serra launched a massive TV ad campaign with such contempt for the taxpayer that it did not even limit the ad to state-owned broadcasters.

Serra went much further than this: he expanded the advertising project to every state in the Union. The television audience of Amapá, which gets its water from Caesa (The Water and Sewer Company of Amapá) and which lives scandalously far from the concession area of Sabesp was regaled with advertising for the company.

A plan for market consolidation may have something to do with this approach, as I believe I read somewhere a while back. Sabesp lists shares on the Bovespa [BVMF:SBSP3]. It may be planning a launch of ADRs or a restructuring prior to  expansion or internationalization. You can imagine more scenarios than I can, I am sure.

The company positions itself in its ads as an innovator and, if I remember correctly, has demonstrated interest in M&A. It merged with Caed in 2012, for example.

In 2009, the case awakened the interest of the regional electoral tribunal of Rio  (TRE-RJ) as a potential case of campaign propaganda outside the established time period for the Serra 2010 campaign.  Because Serra was not yet officially a candidate at the time, the  TRE-RJ could not charge him with an electoral misdemeanor. An investigation by the São  Paulo prosecutor into administrative misconduct might have been in order.

The logic behind  rules applied by the election tribunals is difficult to understand, I find.

Now Alckmin is about to repeat the tactic. This time, he is unlikely to spend money for ads run on the national networks, since what looms on his own  horizon is his reelection as governor.

Sabesp’s ad account is divided among three agencies;  curiously, one of them is Duda Propaganda, the agency headed by Duda Mendonça, a highly esteemed publicist, to be sure, and especially good at election campaigns.

Mendonça was involved in the election of Lula in 2002 and as a suspect in the “monthly payola” scandal that beleaguered the PT.

As if this were not enough, a columnist from the old media, Lauro Jardim [of Veja], announced the winners of the bidding before the results were known, making it seem as though the bidding process was not entirely kosher.

So, then: Will the youth that took to the streets of  São Paulo to protest corruption now express their anger against the Governor and Sabesp?

You could make a similar case for AES Eletropaulo, which recently blew up my computer with a nasty power surge.

The U.S. used to have laws that barred governments from engaging in propaganda for themselves in messages addressed to citizens.

This is apparently changing. Following the use of retired military as spokespersons selling the Second Gulf War to a nationwide audience, the rules were loosened even more:

The National Defense Authorization Act for Fiscal Year 2013 (NDAA) allows for materials produced by the State Department and the Broadcasting Board of Governors (BBG) to be released within U.S. borders and strikes down a long-time ban on the dissemination of such material in the country.

Ad Council

The Ad Council, an American non-profit organization that distributes public service announcements on behalf of various private and federal government agency sponsors, has been labeled as “little more than a domestic propaganda arm of the federal government” given the Ad Council’s historically close collaboration with the President of the United States and the federal government.