Economic growth in Bulgaria continues, directly benefiting the advertising market. Big international companies have been increasing their communication budgets, albeit slowly. In spite of the rise in TV ad prices, medium-sized businesses have also been investing more in communication and now appear in ads aired at the largest TV stations. On the other hand, digital advertising has given even the smallest companies and limited budgets the opportunity to effectively reach their customer base.
Who are the biggest?
According to data by GARB and Nielsen Admosphere Bulgaria, the total investment in TV advertising in 2019 will likely surpass the volume of 2018. Traditionally, the biggest investors in advertising are pharma companies. According to Sofia Peneva, executive director of BBDO Group, by the end of October 2019, the sector recorded a budget increase of 20%, while the other leading advertisers (foods, beverages, retail and cosmetics) added over 10%. The executive director of Ogilvy Group Bulgaria, Ekaterina Tupareva, believes that the bigger spending by pharma companies has shifted towards food supplements from traditional pharmaceuticals.
The Top 3 advertisers in GARB's ranking are the chocolate and confectionery producer Ferrero, multinational consumer goods manufacturer Procter & Gamble, and Carlsberg brewery. In addition to the pharmaceutical sectors, the two leading sectors are foodstuffs and retail.
The Top 10 of advertisers in every industry account for more than half of its advertising investment (see chart). Ten companies account for nearly 100% of advertising in the home appliance sector. Over 80% of spending comes from the supermarket chains, cosmetics, beverages and telecom sectors. The national lottery's TV ad budget accounted for more than half of the total in the hobbies, fashion and sports sector.
Nielsen Admosphere Bulgaria reports that for the first nine months, the press has attracted ad investment equal to just over half of the investment for the full year 2018 and is unlikely to reach that year's level (see chart). With slight changes in the leading spots, the Top 10 companies of 2018 maintained their positions in the first three quarters of 2019. Even so, Yanis Minakos, managing director of Huts JWT and JWT Sofia, is optimistic: "Almost all our clients increased their budgets in 2019 and their sales grew compared to the previous year."
Fresh advertising budgets
Nikolay Nedelchev, founder and director of Publicis Groupe Bulgaria, says that there isn't a single new company in the Top 100 ranking for January-October 2019. "There are, however, several players from different sectors that deserve attention: Roshen, EVN, Home2You, A&D Commercial, AfloPharm, Aroma and Speedy. Most of these companies have long been part of the Bulgarian market, but 2019 saw them invest (EVN, Aroma) in TV ads after a long pause," he notes.
Market watchers have also recorded an increase in the communication budgets of real estate companies, as increased construction activity and growing competition have reflected positively on advertising investments. According to Maria Grashnova, director of Dentsu Aegis Network Bulgaria, the investments made by the construction, home improvement and furnishing sectors jumped by over 60% in the first three quarters of 2019. "An interesting fresh participant in the Top 20 group is the agri sector with a 130% jump," she says.
In the last few years, expanding Bulgarian companies have been increasingly active in communication investments. All Channels Communication Group's director Alexander Duchev says that they have also been seeking progressively exhaustive market analysis from their communication partners. "On the other hand, the consolidation in the banking sector has inevitably impacted our industry, especially in the media. This was compensated by perishable goods and non-banking financial services, which are eagerly competing to attract some of the growing income of consumers," he notes.