Fuelled by digital, UK advertising is expected to increase to £20.8bn next year, surpassing the £20bn mark for the first time, according to the latest forecasts from GroupM.
The figure is up from £19.9 billion in 2018, where growth is forecast to reach 6%. GroupM’s 2019 growth prediction from earlier this year is reduced to 4.8% from 5.1%.
‘Digital’ is around 60% of all advertising investment and accounts for all net UK advertising growth. The medium continues to grow organically, predominately from SME investment, with signs that larger advertisers are becoming “more circumspect” about incremental digital investment.
Pure-play internet increased 11% in 2018 and is expected to continue growing by 9% in 2019.
GroupM forecasts television advertising investment to remain flat in 2018, with 1% growth expected in 2019.
Meanwhile, Facebook is still winning share of audio-visual advertising and is heavily video-biased for large advertisers.
GroupM said the main reason behind this is “convenience and the lust for ‘performance media’”.
Print media continue to shrink, with newspapers and magazines collectively shedding about 1.5 share points a year. In 2017, news brands included 12.5% of all ad investment and in 2018 11.1%, with 2019 estimated to drop to 9.8%.
However, even with mitigation from digital sales – now a large minority of ad sales – this reveals an investment trend of -6% in 2018 and -7% in 2019, as the ‘walled gardens’ capture more share, GroupM said.
However, as reported here, there is a new enthusiasm for the medium which was noted by GroupM in its report.
Elsewhere, forecasted radio spot advertising revenue is to rise 10% in 2018 and 7% in 2019. Radio owners will book about £500 million in spot revenue in 2018. This does not include digital and streaming revenues, which are an unmeasured mix of static and dynamic activity, and thus hard to estimate. The annual run-rate is probably above £100 million.
“Future Brexit fall-out remains a complete unknown, but for now the economy is doing OK,” said Adam Smith, futures director, GroupM.
“Ad revenue forecasts remain perhaps surprisingly positive, supported by digital commanding a rising share of overall marketing effort from a wider base of marketers large and small.
“The UK’s fluid media market favours optimism too. Advertisers know they can change spending plans almost at will, with low or no friction.”
