Advertising Getting Stronger

Our life would be so boring without advertisement, don’t you think? One of the key components of market competition arrived in Belarus in the early 90s and put down roots on television screens, in radio and on newspaper pages once and for all. How does the market feel now, what are the prospects, do the existing regulations come up to the requirements of modern business? The leading advertising agencies of the country answer these questions
Our life would be so boring without advertisement, don’t you think? One of the key components of market competition arrived in Belarus in the early 90s and put down roots on television screens, in radio and on newspaper pages once and for all. How does the market feel now, what are the prospects, do the existing regulations come up to the requirements of modern business? The leading advertising agencies of the country answer these questions.

A $52 million turnover

Last year Belarus became the first country of the former Soviet Union that was awarded a Cannes Lions d’Or, a sort of quality seal for the best advertising company of Belarus, “Kryn”, and for the whole country. The state seems to have been keeping an eye of advertising for a long time, and finally the president insisted that a new version of the law on advertising be drafted and passed by the parliament to become a new set of regulations for the flourishing business…

In monetary terms 2005 proved very efficient for advertising: the market expanded 20-25% on the year, according to Igor Samkin, the executive director of the Belarusian Association of Advertising Companies. The volume of the market stands at $52 million, specialists report. One should also keep in mind that the development of this segment is closely connected with the general economic situation in Belarus. In this case the flexible and sensitive advertising market responds to the economic growth, Igor Samkin believes. “Even amateurs and general public claim now there is more advertisement everyone and it is getting better and better,” he adds.

Alexander Gilburd, the director of “Color Express”, which deals with outdoor advertisement, shares this opinion. He believes earlier the so-called out-of-home advertising appeared in Belarus only because of ambitious producers, while domestic promoters accounted for a minor part of the market. At present there is a segment of “aware” clients that know what they need for their businesses. “Competition is getting heavier, besides, earlier about 90% of suppliers of outdoor advertisement worked in Minsk, whereas now we have a decent number of regional professionals with a narrow out-of-home specialization.

Commenting on this country’s performance in 2005, Petr Popelushko, the director of “SMG Belarus” said Belarus keeps pace with Russia, Ukraine and the Baltic States. “At the same time, $50 million does not seem too much. The easiest way to assess the work of advertisers is to divide the total by the number of citizens — Belarus gets $5. In Russia and Ukraine these markets stand at around $5 billion and $1 billion a year, much more in per capita terms.” Belarusian advertisers are happy even about the modest results, for domestic producers have become more interested in advertising and promotion. “Advertising develops most of all when domestic production grows,” Petr Popelushko said.

At present domestic and foreign customers account for about 30% and 70% of the Belarusian advertising space. Alena Ustinovich, the director of “Belaya Karona” advertising company, is certain Belarus charges domestic companies very low outdoor advertisement fees: the State Television and Radio Company offers domestic customers an 80% discount, something foreign companies can only dream of.

Advertisers are getting more professional and “Belarus-ready” than ever, as they are very well-aware of the needs of Belarus’ public. “Western companies often come to us with ready-make projects, printed advertisements and video commercials. They believe there is nothing here, some vacuum that needs to be filled with their own concepts, but we try to assure them that the mentality of a Belarusian differs a lot even from that of a Russian or a Ukrainian, to say nothing of Europeans. The catches that would surely result in huge sales in the west will never work in Belarus, because we have different values. I believe the largest companies of the world will soon have special budgets to produce advertisements for Belarusians in Belarus,” Petr Popelushko said.

New Regulations Raise Questions

The new version of the law on advertising is to be considered during the spring session of the lower chamber of parliament, the House of Representatives. Igor Samkin, a member of the working commission that considered the document, believes the law “has had enough”. It had been working for 10 years now, and it is high time amendments were introduced to regulate rules of game in new market segments. There was no such notion as LED outdoor advertising ten years ago, besides, some traditional segments need changes, too, Igor Samkin said.

Petr Popelushko believes the new version of the law has a couple of questionable issues, the key one being the 10% limit for television commercials (earlier, the limit was set at 20% of broadcasting time). “Why 10%? In Russia they have 15%, and TV channels got very emotional about the restriction. Fewer commercials means less money to buy interesting shows. By the way, commercials are much more expensive in Russia, and Belarus will never catch up, so why impose limits? I guess any organization, to say nothing of mass media, would love to have more advertisement, because there is a resource for encouragement of personnel and development of infrastructure, the director of “SMG Belarus” believes.

The new version of the law is likely to be passed this year, so it is time to make new plans.

by Viktor Volovich
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