Kwendi Media Audit regular survey: heads of the largest Ukrainian advertising holding companies clarified their forecasts for inflation in 2016

Kwendi Media Audit 10 February, 2016

All major advertising holdings were involved in Kwendi poll: Publicis Groupe Ukraine, Dentsu Aegis Network Ukraine, Omnicom Media Group (Media Direction and Optimum Media), ADV Ukraine and Group M.

As part of Kwendi Media Audit's annual initiative TOP managers of leading advertising holding companies specified the actual rate of inflation in 2015 and gave their forecasts for inflation in 2016. The data is collected as minimum and maximum expectations on the basis of which the average level of media inflation is determined.

The situation on TV in November-December 2015 affected the initial assessment of inflation 2015/2014. The revised data on TV market shows that there was no deflation, the maximum level of inflation was 10%, the average – 7%. Also estimation for the outdoor advertising has changed – in September some respondents noted deflation with lower spread of estimations then earlier (from -6% to + 5%).

In 2016 clarifications were concerned mostly on two categories of media – TV and online video. The growth of demand on TV advertising, while the duration of ad units reduces, has led to extremely high occupancy rate of ad units in November and December 2015 and tough stance of sales-houses on forming of conditions for 2016 year. TOP-managers of all holdings have adjusted their inflation forecast for the TV – now the unanimous assessment of the inflation amounted to 30-35%.

The growing demand for online video, the change in the sales mix and dependence on hryvnia exchange rate may lead to inflation from 20% to 80%.

The spread of experts' forecasts for inflation in 2016 is more significant for online advertising segments than for traditional media. This can be explained by the peculiarities of the online advertising market's state.

Forecasts for inflation are given for prices in local currency.

Svetlana Kalinina, managing partner Kwendi Media Audit: «We are grateful to the leading advertising agencies for their quick refinement of inflation forecasts. We are going to continue our initiative to create an open consolidated assessment of market price dynamics"