Irina Vasenina about the prospects of the market and the features of the crisis in forecasting
February 26 15:07
SHARE:
If there is one word that can describe the current situation in the Russian media market, it certainly – uncertainty. Of course, in such a situation is not only the media market, but advertising for a market economy is a kind of litmus test, and often the best indicator of overall health.
Definitely say what will be the scenario in the near future no one can political pressure makes you do panic forecasts (disconnection from SWIFT, the economic blockade and complete embargo, blocking iTunes and other horrors generations, most of whom know about hunger only memories of grandparents). Temptation of speculation and discussion on this topic is great, but it is far beyond the scope of this article – which aims to answer the least complicated, but a specific question – what will happen with the Russian media market in the near future?
In order to try and make the correct, as far as possible, the forecast must first understand – what prevents today market participants to form a single point of view, to assess the situation and get a clear forecast. Behind today’s top managers of the market leaders successful (as a whole) experience of survival in two crises – and if in 1998 it was still possible to carry if you want to some ancient “dark era”, the 2008 just stayed in the detailed figures of the sales data, indicators tracking reports research offices and industrial meters.
The main reason (and unlike previous years) – is the crisis itself, the causes of which are only partially “natural”, that is, economic in nature. Along with the sharp drop in oil prices because of the “shale revolution” against the general slowdown in the world economy, no less significant factors were the conflict in Ukraine and joining the Crimea, political and economic sanctions against Russia, restrictions on imports and substantial additional costs States in this regard (in addition to the still fresh spending on the Olympics). And if on the same “shale revolution” wrote a long time ago, that other factors was impossible to predict. It is also difficult to simulate the situation with their cancellation, partial or complete. For example, the abolition of personal sanctions against officials and entrepreneurs will likely minimal impact on the market, but the best response the lifting of restrictions on imports from the euro area will not only return range and healthier prices in the medium term, but also can rapidly improve the general background information and mood society.
The most complete picture of today have media advertising agencies, combined baingovye structures which control 20% of the total media market and have a portfolio of their agencies customers of different categories, types and sizes. But here, the agency can not guarantee the accuracy of the forecast – what will be the real budget of the client for the full 2015.
By analogy with the previous crisis years, primarily 2008 advertisers massively switch from annual transactions in the semi-annual and quarterly. It is good practice when based on the most likely scenario (according to the client and agency), formed the annual plan for 2015, which then beat in the quarters and confirmed or corrected during a period. This will provide the necessary flexibility to the customer, and to reduce the risks of business planning – while maintaining a competitive price. But does not give an opportunity to be in the first quarter figures to estimate correctly the whole 2015.
This shift to quarterly transaction is one of the key internal factors of the situation on the media market. On the one hand, as an instrument of flexibility in budgeting such transactions advertiser protect against the risk of substantial loss of media budgets – in the crisis year government channels, or rather their Sellers’, can afford not only significantly less flexibility in the negotiations, but also to take a principled stand in agreement postpone or cancel accommodation without charge, as it was in recent years. But at the same time, there is a large and dangerous lag in decision-making. For example, to confirm which of the scenarios TV support (“optimistic”, “realistic” or “all bad”) is selected for the second quarter (April-June) should be at the end of February – the time when all advertisers with a few exceptions (eg telecom or financial services) will not be final sales data, but only partial information on shipments to distributors.
In the context of speculative purchases end of the year, the availability of stocks at distributors and sales points, saving strategy personal funds in the new year and other picture can be greatly distorted, and a decision on further investment will be made on the basis of incorrect input. Traditionally, the first half of the year is always “loaded” more in the expectation that sales growth in the first blocks allow to justify additional investment in the second half of the year. This year, the “Requests” in the beginning of the year, to be able to receive an additional budget would be virtually impossible. Thus, a high risk that the expectation of the crisis will provoke the crisis itself to a greater extent than objective factors.
In order to correctly assess the correct approach to use of television Celler every year who scrupulously analyze market segments and make predictions for each of them separately, in terms of its dynamics and prospects – and the total score is given as for each of the resulting inflation and the share of the relevant category.
For example, cars that predict a dramatic drop to 35% according to the forecast of fresh PwC – one of the largest categories in the advertising market, but it is less than 10% of the general market media. It is necessary to divide the market by category, consider the number of advertisers and the structure of each of the categories, the specifics of production and many other factors that make a good forecast for 2015. However, none of the forecasts in any case not be able to take into account all factors, primarily foreign economic and political.
So “realistic” forecast, excluding the “effect of panic expectations” – is drop ATL media market 23-26% in 2015 compared to 2014. A similar decline was recorded in 2009 – minus 27%. With this, in contrast to the last crisis, a significant portion of the factors still are artificial (sanctions, restrictions on imports), and can be changed almost instantly (on the scale of economic processes). If desired, you can make a comparison with the first quarter of 2009, the barrel fell to a minimum in January rose to $ 60 just to May, and after that only grew – “goat” barrel played this level in February. Of course, the increase in oil prices has not proportional and immediate effect on the economy. But the cost of a barrel of oil has already largely what is sacred meaning in the eyes of the population and can magically change the overall mood, tone and headlines in the press, for example, to encourage the buyer to stop saving shelf – first in small and then larger purchases.
to make predictions on the basis of a too “optimistic” scenario does not make sense. This course of events is unlikely, and what to do if “all is well” everybody knows – this market is doing in recent years. Oil, even if it rises above the level of $ 70 per barrel, still will not be able to compensate for the new items of expenditure in the budget and currency codes only grow quickly, but do not fall back.
On the other hand, the “pessimistic scenario” – in the form in which it often takes the press – and it makes no sense to predict and assess. New drop in oil prices, the new all-time highs in exchange rates, political and economic embargo, command economy, food stamps – a lot of different scenarios of this kind and for every taste can be easily found in the archives of the end of last year and beginning of this.
The most pessimistic of realistic development scenarios may be the reduction of one-third of the market – this can be a result of a combination of several factors. First, the decline in purchasing power above the expected level – further growth of inflation, accumulation of savings “under the pillow”, actively switching to cheaper counterparts, and so on. Secondly, the failure primarily multinational corporations from investing in the Russian market – to maintain high internal purchase price for the implementation of budget cuts. And third, incorrect assessment of the real market potential and long-term decision-making process – from the moment when the customer returns to the shelf buy your favorite premium coffee until the return of the money back into marketing will take up to six months! In this situation, advertisers may simply not have time to go back to the market and the fall can easily exceed the level of 2008 and to reach 35%. At the same time, you can expect in such a case on record growth in the fourth quarter of 2015, for example.
This will change the market structure – possible reductions will be distributed differently by media. Market volume BTL, which is estimated ACAR in 2013 amounted to almost 100 billion rubles will be significantly reduced and may reduce its share of the costs advertisers almost twice as well as many other media – press, radio, outdoor advertising, and special projects sponsorship or does will be reduced or will to budget on leftovers.
Only Internet will partially protect themselves from cuts through innovative solutions such as online video (the growing media channel last few years) and programmable online media buying (which provides high possibilities for optimizing the effectiveness and clear output indicators).
Online video advertising (OLV or ISP or MSP – according to the terminology used) has become for Many large advertisers part of an overall approach to the planning of video (when and TV and Internet video are part of the same location and are optimized together, not separately) and is no longer perceived as budgeted and the rest of the Internet. Taking into account the possibility of using almost all major video hosting optimizer conditions TV deal, you can expect that it share video (not just TV) budgets in the overall ad spending will grow to a record 80%.
To in many ways, and advertisers for many years TV is the main tool to stimulate sales, understandable and effective. In a situation when you need to optimize costs in order to compensate and increase in production costs and lower sales, and to do so quickly in the first place begin to cut the media – a major item of expenditure, with a relatively short period of decision-making (in comparison with the improvement of the current or running a cheap analog product , for example). In turn, within the budgets of most of the media will be the last to cut it TV.
New Year Eve boom excessive demand, brightly illustrated in social networks photographs night queues for home appliances and TVs stacks purchased “rainy day”, spawned a funny meme is recommended for all in our country “in any strange situation to buy a TV. ” We can safely say that this is the most accurate prediction of the media market in the near future from all possible.
Text: Irina Vasenina, president Progression Group
No comments:
Post a Comment