AA/Warc Expenditure Report finds UK adspend rose by 5.8% year-on-year

According to the latest Advertising Association/Warc Expenditure Report, adspend in the United Kingdom has increased by 5.8% year-on-year to reach £6bn in Q2 2019.

29 Oct 2019

Image credit: Colin Watts on Unsplash.

UK adspend over the first six months of 2019 was 5.2% higher than a year earlier, at £12bn.

Image credit: Sharon McCutcheon on Unsplash.

Google, Facebook and Amazon to dominate global adspend in 2020 - forecasts Warc

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Encouraging adspend figures

The report shows adspend growth for 2019 is forecast to rise by 5% and reach £24.7bn, with the UK's ad market expected to grow a further 5.3% in 2020. The predicted full-year growth figure for 2019 is an upgrade of 0.4 percentage points on the figure forecast at the last release of adspend data in July this year.

Overall market growth is being driven by increased spend on online advertising, which saw rises across most formats. Digital ad formats for radio broadcasters witnessed a year-on-year rise of 15.9% and online national newsbrands recorded growth of 15.6% over the same period. Digital out of home – not included in online totals – experienced growth of 17.2%.

The report reveals particularly strong growth in Q2 2019 compared to Q2 2018 in TV video on demand (VOD) and cinema. TV VOD saw an increase of 20% in Q2 2019, while cinema recorded a very impressive rise of 49.6%. The sector benefited from the entry of several new advertisers in comparison to the same period in 2018, boosting growth substantially.

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"These very encouraging adspend figures for Q2 2019 cover the period immediately following the original Brexit date of 29 March, demonstrating the continued strength of UK advertising during a time of political uncertainty. Advertising's dynamism is shown by the growth recorded across many different formats, with particularly impressive performances from cinema, TV VOD and online radio,” says Stephen Woodford, chief executive at the Advertising Association.

"These figures are positive for our industry and are good indicators of the resilience of the UK economy. However, with another scheduled Brexit departure date looking likely to be passed on 31 October, we are acutely conscious of the industry's desire for the clarity needed to continue investing for the future during these uncertain times."

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"An upgrade to our 2019 projection of almost half a point is reflective of stellar online growth, as well as over-performance for several traditional channels against the expectations we laid out in July. There is little in the data we receive from media owners across the industry to suggest an impending downturn, but growth cannot be taken for granted while economic prosperity remains in the balance," adds James McDonald, managing editor at Warc.

Full-year forecast summary 2018-2020	Adspend 2018 (£m)	2018 v 2017 (% change)	Forecast 2019 (Year-on-year % change	Forecast 2020 (Year-on-year% change)
Search	6,656	14.30%	11.60%	10.30%
Online display*	5,332	21.40%	13.10%	10.10%
TV	5,111	0.10%	-0.90%	2.50%
of which VOD	391	29.40%	18.70%	15.00%
Direct mail	1,552	-8.70%	-9.50%	-5.40%
Online classified*	1,451	-1.30%	1.30%	1.80%
Out of home	1,209	5.70%	6.90%	3.70%
of which digital	603	14.70%	13.40%	11.70%
National newsbrands	968	-7.10%	-3.50%	-3.60%
of which online	274	-2.60%	5.00%	5.40%
Regional newsbrands	804	-9.30%	-9.30%	-4.60%
of which online	228	7.60%	5.40%	7.00%
Magazine brands	718	-7.50%	-7.60%	-5.00%
of which online	270	-0.30%	-1.40%	0.30%
Radio	714	5.10%	2.70%	4.80%
of which online	45	30.60%	20.40%	21.20%
Cinema	254	-2.10%	16.40%	-3.20%
TOTAL UK ADSPEND	23,561	6.20%	5.00%	5.30%
Broadcaster VoD, digital revenues for newsbrands, magazine brands, and radio station websites are also included within online display and classified totals, so care should be taken to avoid double counting. Source: AA/WARC Expenditure Report, October 2019*

At-a-glance media summary	Q2 2019 v Q2 2018 (% change)	Actual versus forecast [Percentage points (pp)]
Search	12.7%	+3.3pp
Online display*	11.0%	-1.2pp
TV	1.3%	=
of which VOD	20.0%	+1.1pp
Direct mail	-14.4%	-3.9pp
Online classified*	8.9%	+6.3pp
Out of home	9.4%	+4.3pp
of which digital	17.2%	+4.1pp
National newsbrands	0.3%	+5.9pp
of which online	15.6%	+12.2pp
Regional newsbrands	-11.3%	-2.9pp
of which online	7.3%	+5.4pp
Magazine brands	-6.2%	=
of which online	-2.6%	-0.4pp
Radio	3.3%	-0.4pp
of which online	15.9%	-6.2pp
Cinema	49.6%	+44.5pp
TOTAL UK ADSPEND	5.8%	+1.3pp
* Broadcaster VoD, digital revenues for newsbrands, magazine brands, and radio station websites are also included within online display and classified totals, so care should be taken to avoid double counting.
Source: AA/WARC Expenditure Report, October 2019