When the president of a leading publishing house in Ukraine said last week that this year advertising in the media reached the pre-crisis level of 2008, many took the news with a grain of salt. They had good reason to be skeptical.
Although
the market is rising steadily, it will take a couple more years to get
to the pre-crisis level, unless it hits a new zone of turbulence.
Speaking
at a recent international media congress in Bangkok, Thailand, Borys
Lozhkin, co-owner and managing partner of publishing house UMH, one of
the biggest in Ukraine, said that the ads market has reached its
pre-crisis level and is continuing to grow.
“The
most dynamic is the internet segment, which has already outgrown the print and took second place after the television,” Lozhkin was quoted by
Interfax as saying.
Lozhkin’s
UMH Group owns dozens of media in Ukraine, including websites,
magazines, such as Forbes Ukraine, radio stations and several
newspapers.
But other market players have a different story to tell.
Artem
Bidenko, head of SA Political Communications Group, says Lozhkin’s
statement only holds true if the estimates are done in hryvnia.
“In
2008 the advertising and communications market was Hr 11.5 billion. In
2012 it was Hr 14 billion. However, a proper assessment should be done
in U.S. dollars because of the currency rate and inflation,” he says.
In
2008, the dollar to hryvnia exchange rate was 1:5, while today it’s
1:8. Bidenko says it will take the market two more years to grow to the
pre-crisis level.
According
to the estimates of All-Ukrainian Advertising Coalition, the Ukrainian
advertising market grew by 13 percent in 2012. In absolute terms, the
most dynamic growth took place on the television advertising market:
from Hr 3.5 billion in 2011 to Hr 3.8 in 2012.
But
these numbers represent a growth of just 9.8 percent, which is below
the market average. Moreover, Artem Zeleny from Green PR Agency, says
the value of TV advertising market is mostly driven up by TV channels
hiking their prices. Print advertising grew somewhat less, by 8.6
percent, to Hr 2.6 billion in 2012.
Advertisers
are expected to spend Hr 4.2 billion on TV ads this year, according to
All-Ukrainian Advertising Coalition forecast.
Internet
market is expected to grow the most in 2013, by nearly 29 percent. But
the growth has a low base of comparison, so the advertisers will only
spend Hr 680 million on web ads, says Maxim Lazebnik, head of the
All-Ukrainian Advertising Coalition.
Artem Zeleny
of Green PR Agency says that brands and companies have become more
active in advertising, but this mostly manifests through requesting more
services with lower budgets. “There are almost no big projects, event
budgets have shrunk,” Zeleny says.
Kyiv Post staff writer Svitlana Tuchynska can be reached at [email protected].
