Media Fact Book 2010 - Witness the [R]Evolution of the Romanian Media Industry

Iulie 2010

INITIATIVE MEDIA S.A.

The 14th edition of the Media Fact Book published by Initiative shows a media landscape that's been greatly impacted by the general economical trends over the past few years. Despite the fact that the recent economic landscape is affected by crisis and recession, the media market is undergoing adaptation and evolution.

The media is changing whether we like it or not and the economic downturn is not the cause but merely an accelerator. Consumer habits are changing and the media ought to capture these evolutions and adapt accordingly in order to remain relevant.

 

The overall picture

The Romanian media market started its downward trend in October 2008. Overall, the media expenditures decreased for all types of media (TV, Radio, Print, Internet, Cinema, Outdoor).

In 2009, the total media market in Romania decreased by 37% in net value, reaching a lower level than in 2006. Print was the most affected media (-55%), followed by OOH (min. -40%), while TV decreased by 34%, Radio by 28% and Cinema & Internet by 19%.

Despite the decreasing volume, TV increased its share within the total net media market by 3% due to attractive pricing and significant inventory available. In addition, the crisis has strengthened TV's already strong position as the Romanians' favorite entertainment source, more and more Romanian people choosing to spend their free time watching TV. New TV channels were launched in 2009: Digi Sport, Digi Sport+ and Mynele TV, while Eurosport 2, VH1 started to be monitored by GfK Romania audience data system.

The Print market was characterized by an overall audience drop, as most magazines and newspapers decreased their circulation. Some titles focused on their Online edition, while others were closed down or sold.

Radio market also faced problems, many local stations were closed some decided to exit the Radio audience measurement, while others improved their distribution via the Internet. 2009 was marked by changes in the audience share rankings where in Bucharest Radio ZU surpassed Radio 21.

In 2009 OOH was in the second most affected media after Print, mostly due to the lack of measurement and evaluation tools. On top of this, the relative expensive production necessary for large formats and special locations drove another limitation to using this medium. We estimate the total number of sites available has remained approximately similar as in 2008, meaning around 25,000 locations.

Cinema increased in number of admissions and in number of new venues being opened. Despite its development Cinema seems to be a marginal choice for media communication, due to the low rate of visits during one year (according to BRAT SNA Focus, only 14% of the population went to the cinema in the last 12 months).

In 2009, the Online advertising, more customizable and offering strong targeting capabilities, increased its share in total net media market, registering the lowest decrease in volume of all media. This was due to the increased number of users and to the fact that Internet becomes a more trusted source of information compared to TV and Print, and is widely spread and consumed amongst urban population. Online is the only media expected to enjoy a real growth in 2010.

According to Initiative's, the total net ad spend in 2010 will continue its downward trend decreasing by approximately 9% vs. 2009. TV and Online are expected to increase their share of total net media market.

Print (-27%) and OOH (-17%) will be the most affected media, while Radio is expected to decrease only marginally (-10%). TV will decrease by 6%, whilst the Online market is expected to grow up to +12%.

The share of Print in the media budget allocation will be reduced in favor of Online or even Radio. The local Print market, currently consisting of over 300 titles, and will most probably face significant cuts.

In Q1 2010 the top investors' ranking didn't change significantly compared to 2009. The leading categories in terms of investment are "Medical & optical products & services", followed by "Mobile telecommunication services". "Hygienic", "Milk products", "Banking & insurance services" and "Cosmetics" are also ranked in the top spenders just as in 2009. The new entry so far in 2010 is "Chocolate products & specialties", with "Cars & 4x4 vehicles" dropping out. "Procter & Gamble" maintained the leading position.

 

Digital Media

Internet

The most important media trend in Romania and abroad is the growth of Online.

The Internet continues to evolve quicker than industry's understanding and ability to use its potential. The financial crisis acts as a catalyst for those advertisers and media agencies ready enough to understand it and use it effectively.

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