Television Advertising On The Up Despite ITV Troubles

The agency noted that TV’s share of advertising expenditure increased throughout the 1990s as the medium was seen as the most efficient means of targeting specific audiences. However, rising costs and the growing attraction of multimedia campaigns has led to spending falls in recent years. Advertisers are now being lured back to TV and with interactive television poised to rejuvenate the market, it is forecasted that expenditure will top £3.5 billion by 2005.

UK Television Advertising Expenditure Forecasts
Year	Spend (£ billion)	% Growth
2000	3.3	–
2001	3.0	-9.4
2002	3.1	1.8
2003	3.2	4.7
2004	3.3	5.3
2005	3.5	4.3
2006	3.6	3.3
2007	3.7	2.9
Source: OMD UK, October 2002

The Challenge To ITV In 2001, commercial TV accounted for 62% of all television viewing and OMD anticipates that the BBC’s share will be further eroded as more consumers switch to digital. However, ITV has not gained from the changing habits of viewers and faces a tough task to hold onto its existing audience.

Ten years ago, ITV commanded three-quarters of all television advertising revenue. The success of BSkyB and the growth in the number of multi-channel homes has led to its share falling below 60%. OMD predicts that this decline will continue through 2002/03 with Channel 5 and the satellite stations being the major beneficiaries.

UK Commercial Television Revenue, By Channel
Channel	2002 Revenue (£ 000s)	Change From 2001 (%)	Share (%)
ITV	1704	2.1	53.7
Channel 4	641	3.1	20.2
Channel 5	257	13.8	8.1
GMTV	62	4.1	1.9
Satellite	510	7.0	16.1
Total	3173	4.7	100.0
Source: OMD UK, October 2002