The global Interactive Advertising Bureau (IAB), which focuses on media and marketing in the digital economy, recently launched in Ukraine. “Ukraine has witnessed unprecedented growth in its digital advertising marketplace in recent years. With the formation of IAB Ukraine, this industry now has a central convening point to enhance collaboration,” commented IAB Executive Vice President Dave Grimaldi on the launch. Business Ukraine magazine spoke to IAB Ukraine CEO Yaroslava Antipina about the group’s vision for the booming Ukrainian digital advertising marketplace.
What attracted IAB to set up a Ukraine office?
IAB Ukraine is acting under IAB license. Each country applying for a license must prepare a business plan. We were able to demonstrate the readiness of the Ukrainian market to implement IAB standards and be a part of an international professional network. Ukraine is forty-fifth country to join the IAB Global Network – I think we waited long enough!
What are the key goals of IAB as an organization in Ukraine?
IAB Ukraine’s aim is to establish unique and transparent standards for digital advertising in the country while conducting research and developing Ukraine’s digital advertising market.
Who are your founding partners?
IAB Ukraine’s founding members include Google Ukraine, sales house and advertising network Admixer, the representative office of market research company Kantar TNS, media investment group GroupM and advertising agency Publicis One, online trading platform OLX Group, media holding Media Group Ukraine, and Ukrainian news website obozrevatel.com.
IAB officials have spoken about the “unprecedented growth” of the Ukrainian digital market over the past few years. How would you characterize this growth?
Just look at the All-Ukrainian Advertising Coalition numbers. According to their annual report, all segments of digital advertising are up, with mobile advertising in particular demonstrating tremendous growth. According to the Ukrainian Internet Association, the market volumes for online display advertising increased by 40% during 2017 in UAH terms. All-Ukrainian Advertising Coalition data shows that TV advertising rose 29% over the same period, while the figures for print and radio advertising are 18% and 20% respectively. Digital advertising has had higher growth rates than other media for a while in Ukraine, but the digital share of advertising budgets now represents a substantial part of the overall media pie, reaching almost 30%.
Which sectors of the Ukrainian digital marketplace currently generate the most advertising revenue?
It would be more accurate to talk about advertising billing rather than revenue. Based on annual digital advertising market analysis by Admixer, the food and beverages sector was the leader in 2017 with a share of 19.7%, followed by hygiene and cleaning products with 11.7%. Meanwhile, cars made up 10.9% of the market.
Which sectors of the Ukrainian digital marketplace offer the best prospects for revenue growth?
I would have to say pharma. In 2017, the pharma sector led the way in terms of the number of active advertisers even though its market share was only 7.4%, earning it fifth place according to Admixer. This means pharma companies are ready to try and are actively taking their first steps towards digital advertising.
What impact have recently imposed restrictions on Russian websites in Ukraine had on the Ukrainian digital advertising marketplace?
Most small businesses felt the impact briefly because of their earlier dependence of advertising via Russian social media platform VKontakte and other popular websites subject to bans. The bigger advertisers quickly redistributed their digital budgets to other platforms. Many Ukrainians continue to use these banned websites via VPN technologies, but Ukrainian advertisers can no longer reach this audience.
How much traffic does a Ukrainian site need to attract before it can realistically hope to start generating advertising revenue?
You can start monetizing your website any time you want. The amount of revenue you will receive depends on the topics you raise, the volumes of traffic you generate, and the geographical breakdown of your audience. The CPM rate (“cost per thousand”) in Ukraine is very low so if your website is reaching audiences in other countries, you will likely receive higher revenues. If you generate video content, you can also earn more as video advertising rates are higher.