Thursday, August 24, 2017
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U.K. Ad Market Sees Growth in Q1, Drop in TV Spend


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U.K. advertising expenditure grew 1.3 percent year-on-year in the first quarter to reach £5.31 billion ($6.9 billion), according to the Advertising Association/WARC Expenditure Report, marking the 15th consecutive quarter of growth but the slowest rate in four years.

There was a 6.2 percent dip in total TV advertising—its sharpest fall since 2009. Total TV spend is expected to slip 1.9 percent this year, though expenditure is forecast to recover in 2018, with 2.5 percent growth.

Adspend growth in the U.K. continues to be driven by the internet, up 10.1 percent year-on-year, which includes digital revenues from TV.

The full-year outlook for 2017 has been downgraded by 0.5 percent to 2 percent growth. The market is expected to recover by 2018 at 2.6 percent growth, driven by the men’s football World Cup and a “likely improvement” in certainty around the terms of Brexit.

Stephen Woodford, chief executive at the Advertising Association, said: “As business sentiment suffers, it’s no surprise to see ad-spend come under pressure—but the market overall remains resilient. Beyond these numbers, our sector is a huge source of inward investment and exports and should be a priority for government as we focus on business beyond Brexit.”

James McDonald, senior data analyst at WARC, commented: “The latest data show that large retailers—particularly supermarkets—and major food brands reined in their TV spending by 25 percent during the first three months of 2017, instead committing to cutting prices on the shelves as household expenditure wanes.

“Higher inflation and slow wage growth has put a squeeze on consumer spending, while business confidence has weakened following the unexpected and indecisive general election result in May. These underlying stresses have resulted in a downgrade to our full-year expectations for U.K. ad market growth, almost all of which will come from digital formats.”



About Kristin Brzoznowski

Kristin Brzoznowski is the executive editor of World Screen. She can be reached at kbrzoznowski@worldscreen.com.

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