Advertising Industry in BiH still hasn’t reached its full potential

Advertising Industry in BiH still hasn’t reached its full potential

Even though there is no official data, according to the state Regulatory agency for communications (short – RAK) the penetration of the internet is approximately 85% and Bosnia has a respectable rate of social media usage. As in any European country, all the FMCG players are present in Bosnia too (Coca Cola, Beiersdorf, Henkel, Procter and Gamble and many successful local players like Atlantic Group, Violeta, Telecommunication companies, Bingo, As Group, Mercator, Sberbank, Raiffeisen). There is also a high presence of international marketing agencies like McCann Universal, Ascanius media (former Direct Media), Mediacom, Zenith Optimedia.

BiH TV Advertising Market

Comparing to any other neighbouring country Bosnia has plenty of TV stations – that would not be an issue If the majority of them would be considered local TV stations, but that is not the case.
The small market consists of 3 public networks (BHT, FTV, RTRS), national or strong regional commercial TV stations like Nova TV, OBN, Pink, BN, TV1, ATV, Hayat TV, Face TV, news networks like N1 and Al-Jazeera, and more than 70 small local TV stations.  This number of key TV players would not even be manageable in a market like German.

More than 75% of the total ad budget goes towards feeding the dominating TV industry (Where due to a non-regulated market dumping of prices. Digital news media, e-commerce, l-commerce, and m-commerce became the dominating power in the advertising industry with the highest growth rates in 2018, except in Bosnia. A small portion of the total advertising budget is online media. Approximately more than 50% of the ads are placed on Google and Facebook.

BiH Digital Advertising Market

When asked about the digital advertising market share, no one can guess even an approximate figure. 
The CPM and CPC prices of the market are so low, that no one can get rich from them even If the digital key players gave Google their whole inventory. The solution to this kind of matter is nothing new in the marketing industry. It is simply called consolidation. Each marketing agency chooses their best local display performers, set the right price, the proper ad space, and share their budgets to the respectable group of publishers while giving Ireland and Zuckerberg a small portion of the budget, which they can easily gain back through smaller clients and smaller publishers.

Number of companies over the past three years

In 2017, 410 companies were registered that are engaged in the activities of promotion (advertising and propaganda) and market research, while in 2018 that number increased by 90 companies. However, in 2019, the number of companies dropped to 468.

Types of companies

Of these companies, 73.7% of companies generate revenue of up to half a million BAM, 24.1% of companies up to BAM 5 million, and 2.1% more than BAM 5 million.

Number of employees and average salary

The number of employees in this sector increased in 2018 by 205 compared to the previous year. In 2019 the slight increase in the number of employees continues and reaches the number of 2,315 employees.

The average monthly gross salary of employees in these companies amounts to BAM 2,142.00, or EUR 1,095.00. This means that employees in companies engaged in promotion (advertising and propaganda) and market research activities are paid an average of BAM 13 per hour, or EUR 7 per hour.

Staff costsAmount in BAMAmount in EUR
Total salaries cost59,496,01230,419,828
Number of employees2,315
Yearly salary per employee25,70013,140
Monthly salary per employee2,1421,095
Daily salary per employee10252
Hourly fee per employee137

On the other hand, the monthly income per employee amounts to BAM 11,616.00, or EUR 5,939.00. The average hourly income per employee is BAM 69, or 35 EUR.

Type of revenueAmount in BAMAmount in EUR
Revenue per employee in a year139,38671,267
Monthly revenue per employee11,6165,939
Daily revenue per employee553283
Hourly revenue per employee6935

Sales and export revenue

Total sales revenue has been increasing continuously for the past 3 years. The sales revenue increased in 2018 for BAM 21,661,248 compared to 2017. In 2019, the sales revenue was BAM 322,679,464, which is an increase of BAM 36,550,791. For the same period from 2017 to 2019, the income from exports increased by BAM 15,913,907.

Top 20 companies by revenue

Top 10 companies share in industry by revenue

Total profit

Companies registered within the activities of promotion (advertising and propaganda) and market research in 2019 together achieved a total profit of BAM 42,250,406, which is an increase of 33.63% compared to BAM 31,616,417 in 2018.

Top 20 companies by total profit in industry

The top 20 companies share in industry by profit