In the next few years, TV advertisements are going to die. Samvel Sahakyan, head of the Prime Commercial online advertising agency has a similar opinion. He is convinced that a large portion of the advertising budget is going to be distributed on the internet platform, as the same television productions can be viewed in more comfortable conditions and at a more convenient time, online.
No official research data has been collected on the volume of money circulating in the Armenian advertising market, and he figures presented are mainly based on expertise. That’s why the figures presented by industry experts sometimes differ from one another.
According to Sahakyan, the market is small, and the circulating money is clear and transparent for all the players on the field. In 2017, the advertisement specialist estimates that Armenia’s entire advertising market was approximately 23-24 million United States Dollars, of which 18.5 million went towards television (including product placement advertising on television shows and soap operas).
According to Samvel Sahakyan, the situation in Russia is different, 40% goes to television, 40% to the internet, and 20% goes to other platforms. In Europe 30% goes to television, 50% the internet, and the remaining 20% to media.
“There will be changes in the market in the coming years, the budget will move little by little to the internet, since now it’s easier to ‘catch’ people on the internet. Up to the age of 35-40, it tends to be the main platform for information. This and for a number of other circumstances testify that the future is internet advertising,” says Sahakyan.
The expert is sure that in order to enter the competition, television should change its style of work and business model, but in order to do that there needs to be qualified professionals, and high quality television managers.
“Content is what’s important today, not the way that it is transmitted. What you create is important, and if that interested us, the advertising agency, then we will put that content as an advertisement on Facebook, YouTube, or somewhere else,” says our interlocutor.
He notes that at the moment, the leading spenders in the advertising market in Post-Soviet countries are Russia, Ukraine, and Georgia. Armenia is in the final place, falling behind neighboring Georgia and Azerbaijan.
The impact of measurements
In Armenia, only television and internet ratings are measurable. The rest of advertising media (radio, external advertising) are not measurable, and from a business perspective are less interesting.
According to Samvel Sahakyan, measurable content has contributed to the development of the Armenian advertising market, and has been positive for the media, advertisers and advertising agencies.
“Before the time of measuring, Armenia’s advertising market was not appreciable for the outside world. You couldn’t swear, that for example H2 at a specific moment was the best option for a customer. And the advertiser is interested as to when their advertisement was watched, how many times and by whom. Telemetrics allowed advertising agencies who do not control the television stations, to offer a competent placement to the advertiser,” says the director of the agency.
In his words, in light of the positive changes, television companies have used their own resources to create agencies, which local advertisers began to use. As a result international network companies (branches of international companies) don’t work with local advertisers.
“Advertising agencies which work with international companies, do not have local clients. Television advertising companies, unlike us, do not have a problem of earning an agent’s money, they pay for content that is relatively cheap, or they embed the advertisement within the content, which confuses the advertiser,” explains the advertising specialist.
In this case, according to Sahakyan, the quality of the service provided suffers, and often, more ads are placed than necessary. This also leads to the depreciation of advertising videos (people begin to get annoyed with the advertisements). The advertiser does not receive a quality analysis or an opportunity for media-planning and strategy development.
According to Sahakyan, the workforce is also a problem in the advertising market. Universities have only recently begun to provide relevant education, professionals are young and they learn as they work.