Reaching the Consumer in the Czech Republic

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Marketing Opportunities

Growing Sectors
Most important growing sectors drawn by household demand are automotive (the average age of automobiles still remains very high in comparison to other EU countries). Other important sectors for household consumption are also building and construction due to economic boom (decreasing rate of unemployment, increasing wages, low inflation rate, huge popularity of mortgage and low interest rates. IT and telecommunication sector, pharmaceutical sector and household consumer goods are also growing reasonably. Czech population is ageing and becomes more multi-ethnical due to an international migration; the population is increasing, and also follow the demand for specific ethnic products.
Consumer Behavior
Czech consumers are traditionaly sensitive to price. But several other factors are becoming increasingly important: the quality, the technology used. For instance, brands are seen as a sign of high quality, but this is more particularly valid for the young population and the products they buy). And advertising and after sales service are the core of business success.
60 % of consumers use a car for doing shopping and prefer going to the hypermarkets. When groceries are preferred, it is for the quality and the freshness of the products.
Consumer Profile and Purchasing Power
As in most European countries, Czech population is getting older. The average age of the population reaches 40,2 years. Services to old persons will get more and more growth potential.
The purchasing power of the Czech consumers is increasing: from 16,920 CZK ( 520 euros per month) in 2003 to 21 000 CZK (800 euros per month) in 2007.
But, the purchasing power of the active population is correlated with its education level. This means that the population which has the capacity to buy is composed of well educated persons. This induces some new consumption behaviors that are really specific. This population tends to prefer products it already knows and consumes more environmentally friendly products and bio products (their consumption rised almost of 50% in 2006 in comparison with 2005).
Consumer Recourse to Credit
Total amount of consumer credits is still rising due to aggressive advertising of consumer credits providers, nevertheless the use of consumer credits is still under european average. Bank and non-bank consumer credits reached almost CZK250 billions. Annual growth of consumer credits is more than 10 % (11.8 % in 2006).
Consumers Associations
Spotrebitel , Czech consumer’s association

Media in Which to Advertise

Expensive but massive impact on consumers.

Main Televisions
Nova TV
CZECH TV ( 2 channels)
Not so much expensive as TV and more specialized. Most newspapers have their regional mutations and target groups of readers, so targeting on specific region and target group is possible and more effective. Advertising supplements may be put into the newspapers. Advertising in specific magazines is a more affordable option for small- to medium- size enterprises to reach their target markets.
Mail is a quite expensive way of reaching consumers (in comparison to the potential impact on consumers). For reaching consumers via mail, the Czech Post is the main mail operator, but other alternative operators or direct marketing companies can be found.
In Transportation Venues
In the biggest cities (Prague, Brno, Ostrava, Plzen).
Inside rail cars, buses, and in train or bus stations.
Hanging flyers, framed posters, stickers, and flat-panel video.
Contact directly the transportation agencies, except for Prague city where you should contact JC Decaux.

Market Leaders:
JC Decaux (for Prague)
Dopravni podnik mesta Brna
Dopravni podnik mesta Ostravy
Dopravní podnik mesta Plzne
Prague Airport
Most of the Czech radio stations are regional. Only a few stations have a whole country impact. Their influence on consumers is relatively low.

Main Radios
Czech radio portal
Radio Impuls
New Technologies (E-Marketing, SMS, etc.)
In Czech Republic it is not very common to advertise by e-mail (although Czechs are disturbed by a lot of spam as everywhere), SMS or other tools. Advertising budget for Internet is smaller then for radio, but that could strongly change in the coming years.
Main Advertising Agencies
ARBO media
Media Marketing Services (only in Czech)

Main Principles of Advertising Regulations

Advertising on alcohol may not be oriented on people under 18 Years, and must fullfill other conditions stated in Act. No.40/1995 Coll.
Advertising of all tobacco products is prohibited (except periodical press, non periodical publications, advertisement on leaflets, posters dedicated for professional in tobacco business.)
Advertising are not allowed for pharmaceuticals and drugs with obligatory prescription or pharmaceuticals containing opiates. Further conditions are specified by Act No.40/1995 Coll.
Use of Foreign Languages in Advertisement
Not regulated. You can use whole foreign spot.
Organizations Regulating Advertising
The Council for Radio and Television Broadcasting
State Institute for Drug Control
Ministry of Health (only in Czech)
The Office for Personal Data Protection
Regional trade licensing offices

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