weCAN, a network of independent communications agencies of Central and Eastern Europe has recently published its annual report about the advertising market of the region. The 300 pages long publication called CANnual Report is out for the third time now, pursuing the same goal as in previous years: to help companies operating in the CEE region get familiar with Central and Eastern European communications trends and have a detailed description of the advertising market in each country.
The context of the CANnual Report 2017 is CEE countries’ social, political and economic system, which in many aspects differs from that of more developed countries. The report reveals the effects of these factors on local advertising industries, examines advertising markets based on different data, and assesses their digital development relying on selected indicators.
Besides analyzing 14 countries – Bulgaria, Czech Republic, Estonia, Croatia, Poland, Latvia, Lithuania, Hungary, Russia, Romania, Serbia, Slovakia, Slovenia and Ukraine – individually, it provides a general overview of the region. It reveals that the total advertising spending in Central and Eastern Europe increased its value from 9.9 billion EUR to 11 billion EUR in 2016.
It points out that television is still the strongest medium regarding the advertising spending in the majority of the CEE markets, led by South-East European countries where high advertising spending is coupled with high audience figures.
However, the main driver of growth in line with Western trends is digital advertising. Last year, the proportion of digital ad spending grew by 5% within the advertising pie, being the only media type that could attain growth compared to the figures of 2015.
The Czech Republic remains the digital king of the region. Internet penetration is the second highest here (83%) and Czech advertisers spend almost half of their budget on digital advertisements. The Czech Republic is followed by other V4 countries, Russia and Lithuania. In Russia – the land of 100 million internet users – advertisers spent nearly 1.8 billion EUR on online ads last year, that is more than the overall ad spending of the Czech Republic for 2016 (including all media types).
It comes as no surprise that the most powerful advertising markets in the region are the Visegrad countries with their solid online segment and the South-Eastern-European states with their extraordinarily strong TV market. This is reflected also by the weCAN Ranking, an index developed by the advertising professionals of the weCAN agency network. The ranking reveals whether the advertising market as an economic sector is stronger or weaker than what the overall economic performance of a country would suggest.
The strongest countries of the list are the V4 and Balkan states with two exceptions: Russia and Ukraine. Following the recession, the economic performance of Russia has started to increase in 2016, and the GDP has increased by 1.5% in Ukraine as well, for the first time since the beginning of the crisis. However, the ad industry strengthened more radically in both countries compared to these figures. Russian advertising spending grew by 11% and the Ukrainian did by an astonishing 27% compared to 2015, the latter currently being one of the greatest growth rates in the region. This is reflected in their newly acquired positions in the ranking: Russia has advanced 3 places and Ukraine 5 places in just one year.
The global giants Facebook and Google have become significant contributors to the growth of digital advertising spending in Central and Eastern Europe, too. YouTube’s user base grew the most rapidly last year. While the number of new Facebook users grew by 3-5% and that of Instagram grew by 5-10%, YouTube managed to end up with a 10% growth in almost every country. Hence it can be concluded that video consumption in the CEE region strengthens not only in terms of intensity but the number of video consumers as well.
While the popularity of big, foreign social media platforms grows constantly in each CEE country, the popularity of local networks is in decline. Among the non-Western social media channels, VKontakte – popular in the ex-Soviet countries – suffered the greatest loss as it was blocked in Ukraine from one day to another by Petro Poroshenko, the President of Ukraine, for national security reasons. Before that, VKontakte had been the most visited social media channel in the country – 13 million people used it on PC only – so after the sanction was passed, an actual exodus started to other social media channels by individual users and brands alike. Their primary destination was Facebook: in the two weeks after the blocking of VKontakte, 1.5 million people registered to the platform.
This year the CANnual Report focuses on content marketing and influencer marketing trends in the region. It reveals which brands and sectors use the available toolkit of content marketing in the most visible way, reaching a target audience of tremendous size, and, as a result, bringing content marketing to the level of mainstream advertising formats. It also presents professionals who were pioneers of the influencer marketing industry on their respective markets and reveals the most popular influencers of each country.
The report can be downloaded for free from http://cannualreport.wecan.net/ make sure to check it out.
