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Bulgarian Expert:Internet Advertising Switches to Facebook, Google Ads

Business | March 28, 2014, Friday // 11:02| Views: 1488 | Comments: 0
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Bulgaria: Bulgarian Expert:Internet Advertising Switches to Facebook, Google Ads Krasimir Gergov, Chair of the Bulgarian Association of Communication Agencies (BACA), photo by BGNES

Net advertising revenue in Bulgaria amounted to BGN 303 M in 2013, according to Krasimir Gergov, Chair of the Bulgarian Association of Communication Agencies (BACA).

Speaking during an annual advertising forum, he noted that the advertising market had remained stable in 2013, registering a decrease by 0.62%, and it was expected to remain stable in 2014, with a possibility to reach 2% growth.

In 2013, there was an increase in net revenues from TV advertising by 2.5% to BGN 185 M and the segment retained the largest share of the advertising market.

Outdoor advertising posted a 2.3% growth in net revenues to BGN 38 M.

Net revenues from press advertising amounted to BGN 40 M, down by 5% from 2012.

Radio advertising registered a decrease by 3.3% in net revenues to BGN 15 M.

"The state turned into the major advertiser for the press and radio segments and the fight to win any public procurement whatsoever was driven by the urge to survive in a battle with no rules. This will change but it is not very likely to change in 2014," said Ivo Tsekov, Managing Director at advertising agency Piero 97, in his review of the advertising market in 2013.

According to BACA data, as cited by economy.bg, Internet advertising net revenues amounted to BGN 20 M in 2013, down by 19.6% from 2012, excluding Facebook and Google ads and announcements.

"Technically speaking, internet advertising did not decrease. On the contrary, it increased but it moved to other outlets such as Google and Facebook," Gergov said, suggesting that the trend would increase over time.

According to data of Piero 97, as cited by Ivo Tsekov, Facebook and Google advertising stood at around BGN 22-23 M.

Gergov suggested that the 10% decrease registered in the beginning of 2014 on the market would be compensated and the year would end with similar results to 2013 or even at a growth by around 2%.

TV budgets formed from public procurement of ministries and municipalities, EU programs and announcements for the parliamentary elections in May 2013 were the main engines of growth in the net budgets for TV advertising in 2013.

According to data of Piero 97, TV advertising registered an increase by around 3.6%.

The main growth driver was the information campaign in connection with the digital broadcast switch-on.

According to the analysis of Piero 97, the commercial advertising segment of the TV advertising registered a slight decrease in 2013 on an annual basis.

In 2013, press advertising retained its share of 13.2% of the total net advertising mix thanks to public procurement related to the digital TV move, with publications mainly in newspapers, as well as the parliamentary elections in 2013.

"The sector continues to be plagued by the old problems such as the lack of transparency as regards circulation, selling at dumped prices, extra-tariff discounts, bonus publications, etc," Ivo Tsekov complained.

According to Piero 97, radio advertising budgets fell by 3% in 2013.

In 2013, radio advertising was also affected by the digital TV move and the parliamentary elections, but the sector reported an overall  stabilization trend regardless of that, according to Tsekov.

The radio advertising market retained a share of 5% of the total net mix.

Outdoor advertising preserved the growth trend from 2012.

Outdoor advertising net turnover increased by 2.3% compared to 2012. The sector grew more stable and sustainable.

Billboards continued to be the main component of the market. Revenues from billboards increased 4 times in 2013.

Tsekov explained that advertisers were paying more and more attention to scrollers, which had entered the market in Bulgaria with a delay by around 10 years compared to the global market.

In 2013, Piero 97 registered a decrease by 13.3% in the gross value of budgets for internet advertising and a decrease by 16.9% in the net value of these budgets. The statistics takes into account premium advertising and partially pay-per-click advertising, without ads on Facebook and Google and announcements.

The first six months of 2013 were more profitable for Bulgarian online media, according to Ivo Tsekov, the biggest year-on-year increases registered in March and May.

In the second half of the year, however, Internet advertising headed down, with the last months of the year, most notably December 2013, being the most unsuccessful months for Bulgarian online media.

Tsekov also said that the volume of Internet advertising market in Bulgaria increased in 2013, adding that it did not expand in the direction of Bulgarian online media.

"The increased competitiveness, the shrinking advertising budgets and the aggressive policy of Google and Facebook made a large number of Bulgarian media outlets bow to the constant pressure for price decreases, focusing on short-term survival and forgetting that their decisions today determine their fate tomorrow and the fate of the sector in general," Tsekov said.

According to Piero 97, an increasing number of advertisers are expressing interest in mobile advertisement and are beginning to see this channel as a separate one, apart from Internet.

According to statistics of the advertising agency, the mobile advertising market in 2013 preserved a growth rate which outpaced a number of times all other channels.

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