Cyprus businesses continue to spend big on digital advertising

Cypriot businesses spend approximately one third of their total advertising budget on digital channels, with seven out of ten businesses estimating that they spend up to €100,000 on digital advertising, according to a report by the Cyprus Advertisers Association.

According to the report, the weighted share of digital advertising out of the total amount spent on all advertising expenditure rose to 33 per cent in 2021, with 72 per cent of participating businesses estimating that they allocate a maximum of €100,000 on digital advertising.

The Cyprus Advertisers Association presented its findings in an online event focusing on digital advertising trends in Cyprus, which took into account the preferences of 100 local businesses.

These businesses accounted for 47 per cent of commercial TV ad spend in 2021, according to Nielsen data.

Other research findings showed that companies investing up to €100,000 euros in advertising invest 50 per cent of their budget in online media outlets.

Conversely, companies that spend up to €1 million a year on advertising invest 35 per cent in digital advertising.

Therefore, the share of digital advertising decreases as the total advertising spend increases.

What is more, 66 per cent of respondents said that their digital advertising for 2021 increased compared to 2020.

For 30 per cent of participating businesses, digital advertising spending remained the same, while only 4 per cent of respondents reduced their digital advertising spending. Overall, spending for 2021 increased by 17 per cent.

Furthermore, the survey revealed that 45 per cent of digital advertising spend is invested in social media, 26 per cent in programmatic advertising, and 22 per cent in international media, while only 7 per cent is invested in Cyprus-based media.

The report also showed that 93 per cent of businesses implement social media campaigns investing 38 per cent of their digital budget.

80 per cent of businesses implement display campaigns with 23 per cent of their advertising budget, while 71 per cent launch video campaigns using 11 per cent of their budget.

As for the rest of the campaigns, 54 per cent implement search engine campaigns, 47 per cent invest in influencer-based marketing, and 33 per cent opt for native advertising campaigns.

Facebook continues to be the main social media site for advertising, with 99 per cent stating that they have locally managed pages and 97 per cent that they have an advertising presence on the platform.

This is followed by Instagram, with 94 per cent stating that they have locally managed pages and a corresponding advertising presence.

YouTube comes in third place, with 76 per cent stating that they have locally managed pages and 63 per cent that they have an advertising presence on the popular video site.

“The increase of brand awareness continues to be the primary goal of digital media campaigns,” the association explained.

“The second most popular objective is to direct traffic to the company’s website, while the third most popular objective is to generate sales,” it added.

What is more, the association said that nowadays, 53 per cent of advertising campaigns include digital media, while 40 per cent of campaigns are implemented solely through digital media.

58 per cent of respondents work with full-service advertising agencies, 55 per cent with specialist digital agencies and 49 per cent have internal processes.

Just 14 per cent of participating businesses said that they work with freelancers to implement their campaigns.

“In this year’s research we have observed a general increase in advertising, especially in digital advertising, and an immediate reaction from businesses after the first year of the pandemic, which ended up decreasing their actions and budget”, Cyprus Advertisers Association president Lefteris Athanasiou said.

“The strong increase in digital advertising in 2021 is due to several factors, such as the fact that 2021 was not a normal year, with half of it being spent while still in a form of lockdown, which resulted in a greater dependence on digital channels,” he added.

Athanasiou also explained that the increased digital connectivity in most of 2020, resulted in certain behavioural trends and patterns, such as an increase in online shopping, which remain with consumers until today.

He also noted that digital advertising is expected to play a greater role in the communication strategies of companies and businesses in 2023.