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Russian Ad Agencies Gaining Momentum
// RECMA publishes rating of the largest media agencies
International advertising agencies' Russian business is bringing them ever greater profits. According to the French consulting company RECMA, the share of Russian business in the turnover of multinational media agencies averaged 1.5 percent, comparable to France or Spain. The Russian office of the Vizeum agency set the record with a 6.6-percent share.
RECMA, the world's leading experts in international advertising, ranked Russian agencies according to ad purchases in 2006. That rating is part of a global review that analyzes agencies' turnover in 48 countries. RECMA used client lists and TNS Gallup AdFact data on the 200 largest advertisers in Russia. Average discounts (70 percent for television, 45 percent for radio and movie theaters and 35 percent for the press) were calculated into client budgets. RECMA has been tracking the Russian ad market since 2002.
This year, RECMA disclosed the turn over of 23 Russian agencies. The leader in the rating was Starcom (part of Publicis Groupe Media) with turnover of $309 million, up 42 percent from 2005. MediaVest, another Publicis agency, was in second place with a turnover of $227 million, twice the level of 2005. The Initiative agency, part of the ADB group, occupied third place ($205 million, up 19 percent).
Elena Chizhova, general director of the PHD agency (BBDO Russian Group), commented that the RECMA rating makes clear the division of power on the market. Andrey Brayovich, deputy general director of Aegis Media thought the assessment of the agencies affiliated with Vizeum and Carat “looked adequate,” but suspected that the results for the other agencies were inflated.
Starcom MediaVest Group president Sergey Beloglazov said that growth in the turnover at Starcom and MediaVest was due to new clients. In 2005, MediaVest received the business of Avon (analysts estimate $30 million) and VimpelCom ($33 million), and Starcom worked for LG (over $40 million) and Gillette ($30 million).
Beloglazov noted that Russian business is bringing in greater shares in the turnover of international agencies. It can be seen in the findings of RECMA that the average Russian office of a multinational agency accounted fro about 1.5 percent of the total turnover in 2006, which Beloglazov characterized as “on the level of other countries.” According to the ZenithOptimedia agency, the United States occupies more than 40 percent of the world advertising market, France occupies 3 percent, Spain 2 percent and The Netherlands 1 percent.
Brayovich said that the Russian office of Vizeum is developing much faster than the company as a whole. In 2006, it received the ad budgets of Tele2 ($20 million) and Lebedyansky ($20 million). Competing agencies say that the Russian Vizeum office may be preparing for the sale of the agency. The British Aegis Group owns 37 percent of stock in the agency and plans to buy the remaining 37 percent form company executives in 2009. That deal should be worth €16 million if the company attains certain financial indicators. Brayovich denies any connection between the company's performance and the coming sale.
The Largest Media Agencies in Russia by Media Purchases in 2006
| Rank |
Agency |
Group in Russia |
Turnover in 2006 ($ million) |
Turnover in 2005 ($ million)* |
|---|
| 1 | Starcom | Publicis Groupe Media | 309 | 217 | | 2 | MediaVest | Publicis Groupe Media | 227 | 111 | | 3 | Initiative | ADV | 205 | 171 | | 4 | Optimum Media OMD | Optimum Media OMD Group | 196 | 113 | | 5 | Vizeum | Aegis Media | 185 | 81 | | 6-7 | Mediaedge:cia | Group M | 183 | 162 | | 6-7 | Smart Communications | Video International |
183 | 162 | | 8 | ZenithOptimedia | Publicis Groupe Media | 175 | 21 | | 9 | Universal McCann | ADV | 170 | 162 | | 10 | Maxus | Group M | 169 | 107 |
| 11 |
MindShare |
Group M |
165 |
139 |
| 12 |
OMD Media Direction |
BBDO Russia Group |
164 |
144 |
| 13 |
MediaCom |
Group M |
160 |
69 |
| 14 |
APR Media Services |
Optimum Media OMD Group |
135 |
96 |
| 15 |
MPG |
ADV |
118 |
94 |
| 16 |
Carat |
Aegis Media |
98 |
79 |
| 17 |
Sorec Media |
In alliance with Optimum OMD Group |
63 |
54 |
| 18 |
MediaFirst |
Twiga |
58 |
37 |
| 19 |
PHD |
BBDO Russia Group |
57 |
28 |
| 20 |
Rapp Collins Media |
Optimum Media OMD Group |
51 |
19 |
| 21 |
Medialect |
Gram |
35 |
37 |
| 22 |
MC2 |
Group M |
21 |
12 |
| 23 |
TBWA\Mediaplan |
Optimum Media OMD Group |
18 |
10 |
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*Based on the rating of Kommersant and Advertising Industry magazine of the largest Russian media agencies
Source RECMA
Sergey Sobolev
All the Article in Russian as of Aug. 10, 2007
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Photo: Mikhail Razuvaev
