Revenues from television advertising were growing prior to the COVID-19 outbreak. During the first quarter of 2020, in spite of the 4% decrease in March, revenues from television adverts grew by 7% and amounted to  GEL 13,659,925, which includes commercials, sponsorship, product placements, announcements and teleshopping.

During the first quarter of 2020, the highest growth rate with regards to advertising revenues was posted by the television and radio company Trialeti (317%), followed by Studio Maestro (231%), the Georgian Public Broadcaster (189%), GDS TV (56%), TV Pirveli (50%) and Teleimedi (27%).

Rustavi-2 posted the highest losses in income from advertising, seeing its revenues being halved. Silknet’s revenues decreased by 65%, Caucasus TV’s by 48%, and the revenues of Setanta Georgia’s by 40%.

During the first quarter of 2020, television advertising revenues for each broadcaster were as follows: Teleimedi -  GEL 5,404,783.27; Rustavi-2 –  GEL2,555,286.62; Georgian Public Broadcaster -  GEL 438,038.97; TV Pirveli - GEL 927,809.19; Main Channel - GEL 1,859,641.48; Silknet - GEL 229,656.03; GDS TV - GEL437,105.48; PosTV - GEL 465,590.91; Setanta Georgia - GEL 140,829.45; RBG - GEL 116,980.19; TV 25 – GEL 123,116.93; Palitra TV – GEL 109,692.80; Studio Maestro - GEL 132,764.00; Rugby TV - GEL 53,573.00; Caucasus TV – GEL 46,468.78 Trialeti - GEL 96,280.00; Media Union Obiektivi - GEL 48,890.00;  Basti-Bubu - GEL 34,570.00; Focus Studio - GEL 36,529.66; others - GEL 402,317.85.

As for the second, third and fourth quarters of 2020, the pandemic is predicted to affect the television advertising market. For example, the impact of the crisis on the tourist industry is already evident. Tourism accounted for 8.1% of Georgia’s GDP in 2019. Therefore, the commercial activity of companies working in this sector will decrease, negatively affecting the advertising market.

According to GeoStat’s preliminary calculations, the GDP already decreased by 2.7% in March. Naturally, this trend will also affect the advertising market in 2020.

In terms of television commercials and sponsorships, 85% of the total gross rating points (GRPs) generated by advertisers in 2019 was accounted by the following categories: drinks, food, sports, tourism, entertainment, medicine, beauty and healthcare, finance, industry and services.  

Thus, companies representing the aforementioned industries will have generated most advertising revenues in 2019, and would also have been the largest revenue generators in 2020.

Certain products and services have experienced a sharp drop in demand, while others have seen demand grow. Overall, the crisis has had a negative effect on the food sector as a whole. For example, while the GRPs generated by the food category in March and April increased by 53%, and by 52% in case of the telecommunications category, total GRPs generated in April still constituted a 25% decrease compared to the same period of last year. 

In terms of advertising revenues, based on the figures presented to the GNCC by television broadcasters, revenues generated by commercials and sponsorships alone fell by 1% in March, while total advertising revenues fell by 4%. The figures for April are expected to reflect an even sharper decrease.

Despite the growth in television advertising revenues during the first quarter of 2020, the pandemic is expected to have a negative impact on the advertising market for the whole year. However, the lifting of restrictions and reopening of businesses will help the advertising assets to recover.

Furthermore, 2020 is an election year, meaning that revenues from political advertising are likely to balance out the losses sustained by broadcasters in the commercial sector.

GNCC predicts that despite the negative effects of the pandemic, the end-of-year losses on the advertising market will not be substantial.