The review of Ukrainian media market with a focus on Digital component. Comparison of key indicators of the Internet industry in Ukraine with world and European trends, analysis of media consumption in Ukraine, all the benefits of the Internet as a media, in comparison with the TV. The highlight of the presentation - agency forecasts for the share of investments in the Internet media until 2016.

1. DIGITAL
MARKET
OVERVIEW
2014

2. STRUC TURE
WORLD
01
INTERNET FACTORS COMPARISON
UKRAINE ON THE MAP OF EUROPE
MEDIA CONSUMPTION TRENDS
MEDIA GIANTS BATTLE
UKRAINE
02

3. WORLD
INTERNET F AC TORS C OMPARISON

4. UKRAINE OVERTAKES
THE WORLD AVERAGE
PENETRATION INDEX
BECOMES CLOSER TO
THE DEVELOPED WORLD
INTERNET PENETRATION
2014:
78%
DEVELOPED
40%
WORLD
32%
DEVELOPING
DEVELOPED COUNTRIES WORLD DEVELOPING COUNTRIES UKRAINE
4%
23%
43%
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

5. UKRAINE OCCUPIES
A MIDPOSITION
EUROPEAN LEVEL
IS JUST NEXT DOOR
UKRAINE DIGITAL C APAC ITY
UKRAINE:
69%
URBAN POPULATION
43%
INTERNET POPULATION
27%
SOCIAL NETWORKING
PENETRATION
URBAN POPULATION INTERNET POPULATION SOCIAL NETWORKING PENETRATION
GLOBAL UKRAINE EUROPE

6. WORLD
UKRAINE ON THE
MAP OF EUROPE

7. UKRAINE TAKES
THE 9TH PLACE
GREAT OPPORTUNITY
TO CONNECT UKRAINIAN
CITIZENS TO THE WEB
TOP 10
EUROPEAN COUNTRIES BY INTERNET USERS
9,8М
17,9M
19,0M
15,0M
# OF INTERNET USERS IN UKRAINE
DIFFERENT SOURCES – DIFFERENT FIGURES
PENETRATION ACCORDING TO “WE ARE SOCIAL”

8. THE GREATER
INVESTMENTS IN DIGITAL
=
THE MORE REWARDS
TODAY ONE INTERNET
USER ACCOUNTS FOR
~ 13 USD OF DIGITAL
INVESTMENTS
TOP 10
EUROPEAN COUNTRIES BY INTERNET USERS
DIGITAL SPENDING,
BLN $
# OF INTERNET
USERS
ROMANIA
UKRAINE
POLAND
SPAIN
ITALY
NETHERLANDS
FRANCE
RUSSIA
GERMANY
UK
=
=
BY INTERNET AUDIENCE
BY $ SPENDING PER USER
BUBBLE SIZE = $ SPENDING PER ONE INTERNET USER
BY DIGITAL AD REVENUE, 2013
#6 OUT OF TOP

9. HUGE POTENTIAL
FOR DEVELOPMENT
UKRAINE ON THE MAP OF EUROPE
TERRITORY
#2
MOBILE USERS POPULATION SM USERS INTERNET USERS
#6 #7 #7 #9

10. UKRAINE
MEDIA C ONSUMPTION TRENDS

11. INTERNET
CONSUMPTION
DOUBLED
FOR THE LAST 5 YEARS
INTERNET. WEEKLY C ONSUMPTION
ACTIVE DAY TIME
(FROM 7:00 TILL 23:00)
IS SPENT BY UKRAINIAN
CONSUMER IN THE
INTERNET4.4
4.7
6.0
6.9
7.6
8.6
2009 2010 2011 2012 2013 2014
HOURS 2014:
54% OF
x2

12. TRADITIONAL MEDIA
CONSUMPTION IS
FALLING DOWN
TV IS A LEADER
AMONG TRADITIONAL
MEDIA CHANNELS
TRADITIONAL MEDIA. WEEKLY C ONSUMPTION
19%
3%
33%
42%
TV OOH RADIO PRINT
2009 2010 2011 2012 2013 2014
17.9
13.8
6.4
2.8 1.6
4.3
13.4
14.4
HOURS

13. MEDIA CONSUMPTION & MEDIA INVESTMENTS
INTERNET AS A MEDIA
CHANNEL NEEDS
ADDITIONAL MEDIA
INVESTMENTS
INTERNET OTHER MEDIA TV
20%
34%
18%
43%

14. SO WE HAVE BIPOLAR SITUATION
TV
INTERNET
old consumer habit
to have TV background while doing
something at home
essential part of life
for today’s consumer
OVER-ESTIMATED
UNDER-ESTIMATED

15. UKRAINE
MEDIA GIANTS BATTLE. TV VS INTERNET

16. 2002-2013
GFK UKRAINE
NIELSEN
RESEARCH
APPROACH
PEOPLE-
METER
PEOPLE-
METER
MEASUREMENT
TECHNOLOGY
SIGNAL
FREQUENCY
VOICE
GEOGRAPHY
ALL UKRAINE
SAMPLE
2 540
3 740
AUDIENCE
HOUSEHOLDS WITH 1+ TV
INDIVIDUALS 4+
HOUSEHOLDS WITH 1+ TV
INDIVIDUALS 4+
2014-2019 ALL UKRAINE
TV VIEWING ANALYSIS
STABILITY &
MONOPOLY OF THE
INTERNATIONAL
PLAYERS
SLIGHT IMPROVEMENT
IN MEASUREMENT
TECHNOLOGY AND
GROWTH IN SAMPLING

17. + URL
+ TIME
+ HABITS
+ AGE
+SEX
+ REGION
FROM TOSITE-CENTRIC CONTENT-CENTRIC
INTERNET ACTIVITY ANALYSIS
SEVERAL PLAYERS
DEVELOP AND IMPROVE
RESEARCH APPROACH
TO GET IN-DEPTH
CONSUMER INSIGHT

18. INTERNET & TV C ONSUMPTION
2 0 1 4 / 2 0 0 9 A M O N G D I F F E R E N T A G E G R O U P S
YOUTH 12-18 MIDDLE AGE 21-35 OLDER 45+
30%
67%
24%
91%
11%
165%
GROWTH OF INTERNET
CONSUMPTION AMONG
ALL AGE GROUPS

19. RAPID SWITCHING OF TV
VIEWERS TO INTERNET
INTERNETTV
81
78
17
38
119%
INTERNET & TV C ONSUMPTION
2 0 1 4 / 2 0 0 9 A M O N G T V H A V Y V I E W E R : E V E R Y D A Y W A T C H I N G
% OF PEOPLE
5%

20. LOW TV PRICE IN
COMPARISON WITH THE
WORLD TENDENCY
WORLD CENTRAL
EUROPE
RUSSIA NORTH
EUROPE
WESTERN
EUROPE
UKRAINE
89.9 88.6
86.3
65.7
59.5
14.0
CPT, UAH
WHAT IS A SECRET OF TV SUCCESS IN UKRAINE ?

21. WHAT IS A SECRET OF THE INTERNET IN UKRAINE ?
PRECISE
TARGETING
TV PLANNING APPROACH INTERNET PLANNING APPROACH
PLANNING
TARGET
AUDIENCE

22. WHAT IS A SECRET OF THE INTERNET IN UKRAINE ?
LOWER CPT IN
COMPARISON WITH TV
ONLINE VIDEO WITH TARGETING, ₴
20-45 20-45
DIRECT TV, ₴
~ 1 500
~ 2 500
~ 1 600
~ 3 500
* # OF TRP'S CORRESPONDS TO EFFECTIVE TV & INTERNET REACH 1+

23. AND AS A RESULT
DIGITAL DRIVES GAINS
WILL ACCOUNT FOR OVER 25%
OF GLOBAL MEDIA ADS THIS YEAR

24. AGENCY FORECAST OF DIGITAL AD SPENDING SHARE
DIGITAL BECOMES
MORE APPROPRIATE
AS A COMMUNICATION
PLATFORM FOR
ADVERTISERS
21%
23%
26%
28%
30%
2012 2013 2014F 2015F 2016F
GLOBAL EUROPE UKRAINE
2012 2013 2014F 2015F 2016F 2012 2013 2014F 2015F 2016F
24%
26%
28%
30%
32%
7%
18%
22%
24%
25%

25. C O N T A C T S :
+ 3 8 0 4 4 3 9 0 5 8 5 5
I N F O @ M E D I A H E A D . C O M . U A