NEWS3 July 2012

Olympics to boost UK advertising spending, says GroupM

Financials UK

UK— Advertising spending in measured media in the UK is expected to show a 3.4% increase this year, largely due to the Olympics and a boost in digital media spending, according to WPP’s GroupM.

The report, ‘This Year, Next Year: UK Media and Marketing Forecasts’, said measured ad spending in the UK is expected to reach a total of £13.2bn in 2012, up from £12.7bn in 2011. It also predicts that UK ad spending in 2013 would increase 3.2% to £13.6bn.

GroupM futures director Adam Smith explained: “With every source of final demand growth stalled – consumer, government, corporate fixed investment and foreign – UK advertising investment remains at maintenance levels, lagging behind even nominal GDP growth.”

“According to our forthcoming global forecasts, the UK is leading media growth among the larger western European countries. Germany and France are barely positive in 2012 while Italy and Spain are expected to contract about 8%.”

Digital spending growth is expected to continue to grow by 11%, the report found. It tips the medium to exceed £5.3bn in 2012 and is expected to reach £6bn in 2013.

Smith said: “Smartphone proliferation has suddenly made mobile search an urgent priority, while bestowing long-awaited targeting intelligence at scale. Mobile devices are also fuelling second-screen usage, which is another digital revolution in the making: versatile, universal and ergonomic.”

Meanwhile, spending on regional newspapers will total £1bn in 2012 and is expected to drop to £971m next year — a decline of 11%. Spending on national newspapers should fall from £1.2bn in 2012 to £1.1bn in 2013, a drop of 5%.