19:49 23.10.2018

TV ad rates grow by more than 30%, those of outdoor advertising 40-50% up

3 min read
TV ad rates grow by more than 30%, those of outdoor advertising 40-50% up

Rates of television advertising have grown by more than 30% in annual terms, those of outdoor advertising were 40-50% up year-over-year, advertising market operators and ad buyers told Interfax-Ukraine.

Quotations of TV advertising increased by 35% in annual terms, while those of outdoor advertising grew by 30-40%, leading marketing communications manager of MHP's Marketing Department Serhiy Kostya said. Online advertising went up in price by no more than 35%.

"We are moving away from classical tools. We will be looking for alternative solutions for the effective use of the media budget without losing contact with the consumer," he said.

Kostya says his company does not notice changes on the advertising market in connection with forthcoming elections except for a usual reduction in available advertising slots.

Commercial Director of 1+1 Media Group Valeriy Varenitsya said that the Group had not yet announced its rates for advertising in 2019, whereas they were known at the same period in previous years.

"Internally, we admit 25-40% inflation depending on an advertiser. As for advertising rates, their increase is obvious. Current demand confirms this - the holding's slots are 100% sold out for a fifth month in a row," he said.

Inflation expectations on the TV advertising market are generally higher than this year's inflation index, but the exact figure has not been announced, the press service of the Volia provider told Interfax-Ukraine.

"According to our data, prices of TV advertising this year have grown by 30% on the average on the market. In addition, the demand-supply ratio has its impact on advertising platforms' pricing policy. For example, demand exceeds supply traditionally from September till the end of the year, which also significantly influences the rates," Acting General Director at AB InBev Efes in Ukraine Denis Khrenov said.

In addition to an increase in TV advertising rates, he also pointed to a steady upward trend in the cost of outdoor advertising, which has been by 45-50% this year, mainly due to a reduction in advertising space in cities after local councils have approved their concept of outdoor advertising.

Inflation in online advertising averages within 50% for video and 25% for other formats, he said.

"Content created for election campaigns presently accounts for a significant share of advertising space. But, in our opinion, these circumstances do not have a considerable impact on the advertising market of business organizations," Khrenov said.

He also forecasts that since the beginning of next year, the situation might slightly change, but it is difficult to predict how critical it will tell on commercial advertisers.

Khrenov says the TV advertising market is facing a challenge that can significantly affect it during the election campaign.

"When reducing the advertising quota on TV from 12 to 9 minutes per hour, they removed a clause that required that three additional minutes should be added to them for the period of election campaigns to ensure equal rights for participants in the electoral process. And at the moment, it is unclear which resolution needs to be taken to bring back those extra minutes," he said.

If this does not happen, commercial clients' advertising opportunities on TV will be significantly affected, he said.

As reported, the online media advertising market in Ukraine in January-June 2018 amounted to UAH 1.094 billion, which is 32% higher than the figure for the same period in 2017. The share of direct sales on the online media advertising market for this period was 56.13%.