The UK is Europe’s slowest-growing major ad market in 2006 and, were it not for the internet, would also be in 2007, according to a new report from Group M.
Group M also predicts internet advertising will comprise 18% of media investment in 2007, v regional newspapers 18% and national newspapers 12%.
It adds that direct response advertisers are already encountering hotspots of demand on the internet where they now find returns can be poorer than for old-fashioned direct mail.
The report says that brand advertisers, who have previously comprised a small minority of internet activity, are earmarking large sums to invest online which could be in the order of £200 million or £300 million of new internet money in 2007/8, up from about £100 million in 2006.
It adds that even if internet growth steps down a gear or two as the baton passes from direct response to brand, it could still easily occupy 25% of UK ad budgets by 2010 and TV is the most vulnerable to brand substitution.
In October, Merrill Lynch downgraded its global ad forecast, saying that it expects 1.3% ad growth in the UK this year, a slowdown from last year’s 2.5% growth (see Merrill Lynch Lowers Global Ad Forecast).
| £ Million, Net Except Where Stated |
2005 |
2006f |
2007f |
| TV |
3,569 |
3,404 |
3,431 |
| Interactive TV |
16 |
20 |
26 |
| Mobile |
20 |
30 |
50 |
| Radio |
471 |
461 |
466 |
| National Newspapers |
1,641 |
1,604 |
1,571 |
| Regional Newspapers |
2,548 |
2,356 |
2,277 |
| Consumer Magazines |
697 |
709 |
710 |
| B2B Magazines |
900 |
895 |
902 |
| Outdoor |
717 |
742 |
784 |
| Cinema (Includes Production) |
160 |
167 |
172 |
| Internet |
1,161 |
1,615 |
2,200 |
| Media Total |
11,902 |
12,003 |
12,590 |
| YoY % Change |
2005 |
2006f |
2007f |
| TV |
3.2 |
-4.6 |
0.8 |
| Interactive TV |
n/a |
25.0 |
30.0 |
| Mobile |
n/a |
50.0 |
66.7 |
| Radio |
1.9 |
-2.1 |
1.1 |
| National Newspapers |
-2.1 |
-2.3 |
-2.1 |
| Regional Newspapers |
-4.3 |
-7.5 |
-3.3 |
| Consumer Magazines |
0.1 |
1.6 |
0.2 |
| B2B Magazines |
-2.1 |
-0.6 |
0.8 |
| Outdoor |
5.8 |
3.5 |
5.7 |
| Cinema (Includes Production) |
-2.1 |
4.8 |
3.0 |
| Internet |
65.6 |
39.1 |
36.2 |
| Media Total |
4.2 |
0.9 |
4.9 |
Source: Group M
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