There is a decline in the outdoor advertising market in Saratov

Since the beginning of the year, there has been a decline in the outdoor advertising market in Saratov. Kommersant was informed about this by the city administration. Now the mayor's office is analyzing the phenomenon; the drop in demand has reached 50% compared to last year. Large advertising agencies claim that there is now a seasonal decline and it will be possible to talk about any trends only in March. Small market players are already talking about a critical situation.

There is significantly less outdoor advertising in Saratov

As the Saratov administration told Kommersant, the city has recently experienced a decline in the outdoor advertising market. “The Municipal Unitary Enterprise “City Advertising Center” has recorded a reduction in orders for the placement of advertising materials both on billboards and at bus stop pavilions. The company is now analyzing this phenomenon,” the press service of the mayor’s office said. According to the city administration, large players have seen a reduction in the number of orders reaching 50%.

According to the latest data, 1,100 advertising structures (billboards) have been placed throughout Saratov. Until October 2013, when the latest version of their placement scheme was approved, there were about 1.5 thousand billboards. Then the architectural and construction council of the city administration decided to reduce the number of advertising structures in the historical center of Saratov by 70%: out of 400 structures, 280 were dismantled. As a rule, they belong to private advertising agencies. Municipal Unitary Enterprise "City Advertising Center" services 280 bus stop pavilions, as well as advertising stands and poster stands.

In total, more than 30 companies operate in the outdoor advertising market in Saratov, the largest are the federal companies Russ Outdoor and Gallery (31% of the market), as well as the company “Aesthetics” (35% of the market). 6x3 m billboards make up about 70% of all city advertising structures.

Major participants in the advertising market say that the situation has seriously worsened compared to December last year, but they cite the seasonality of the phenomenon. Director of the Saratov RA “Aesthetics” Vladimir Rakcheev says that there is indeed a decline, but there is no point in drawing clear conclusions about the situation in January. “From practice, January and February are empty months, everyone knows about it. Currently, the load is approximately the same as in the same periods in previous years. It will be possible to talk about any trends only in March. I think that there will indeed be a recession, because there is a crisis, and we will not escape from it. First of all, the problems will affect domestic producers of goods and services; they will not be able to fully advertise their products. Without advertising, they will have no sales,” notes the head of the Aesthetics Agency. As for the enterprises that will engage in import substitution, then, in his opinion, they will appear on the advertising market no earlier than in three years.

At the same time, according to Mr. Rakcheev, at the beginning of the year the price of materials for the production of outdoor advertising increased greatly. “Paint, fabrics - everything has become very expensive, and because of this, the price of producing advertising products has also increased. But the price for advertising remained at last year’s level,” notes the director of the advertising agency.

Oksana Antropova, director of the corporate communications department at Gallery, says that the decline is a predictable phenomenon and should have been expected at the beginning of the year, since advertisers are just forming budgets.

Smaller companies have already felt the savings from the advertiser. Thus, Anton Chugaev, director of Accord LLC, says that recently the customer has begun to save on materials. “First of all, there has been a decline in the quality, size and cost of structures that are now being ordered. If earlier we tried to use higher-quality expensive materials, now in December-January we began to sharply roll back to the situation about two years ago: cheaper materials became in demand, projects became simpler in their design,” says Mr. Chugaev. He attributes this to the “incredible” rise in materials prices. “For example, the glue that advertisers use cost 240 rubles per package in December, now it costs 980 rubles. We cannot understand what is causing this growth. Even taking into account the fluctuations between the dollar and the euro, there was no growth of 3-4 times,” says Anton Chugaev.

The head of an advertising agency says his company was forced to raise prices for services. “We have to monitor prices every three days and call all suppliers. At the end of December - beginning of January, there was a period when suppliers refused to sell materials, because it was easier for them to “sit on the goods” and then raise the price. Now deliveries have resumed, but the cost of materials is catastrophic,” he notes.

Sergei Petunin

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