NEWS30 January 2020

Digital growth boosts Q3 ad spend

Brexit Media News UK

UK – Advertising spend in the UK grew 5.6% year-on-year in the third quarter of 2019, according to the most recent report published by the Advertising Association/Warc.

Piccadilly Circus

Spend during Q3 was £5.97bn, slightly ahead of the forecast for the period and signifying a 25th consecutive quarter of growth for the industry – although this is largely driven by online advertising.

Digital out-of-home ads saw the highest uptick at 17.1%. Broadcaster video-on-demand grew by 16.7% and spend on national online newsbrands was up 6.5%, compared to the third quarter of 2018. Cinema advertising also grew by 46.5% year-on-year.

Spend on regional newsbrands was down -11.7% on the same period in 2018, with magazine brands, direct mail, TV (with the exception of VOD) and radio all down.

Spend on advertising is expected to reach £24.8bn for 2019, which if met, would mean growth of 5.2%, with a further 5.2% increase forecast for 2020.

James McDonald, data editor at Warc, said: “The UK’s ad market has sustained a 25-quarter period of expansion, but underlying data show that this growth is asymmetric – excluding online advertising, the UK’s ad market has contracted each quarter for the last four years. Online formats account for three in five pounds spent on advertising in the UK, and we expect this to rise to two in three by mid-2021, fuelling total market growth in tow.”

Stephen Woodford, chief executive at the Advertising Association, attributed the continued growth partly to the growth in SME businesses’ spend on digital as well as larger advertisers shifting budgets into digital formats.

Woodford said: “These media spend figures are particularly impressive given this was a period of Brexit and political uncertainty and very low overall economic growth. With Brexit now a certainty, the industry’s focus now turns to the future relationship with the EU and the importance of this to the overall health of the economy, which underpins this media spend growth.”