World Cup, Improving Economy Lift U.K. Adspend Forecasts

LONDON: The Advertising Association/Warc Expenditure Report has revised its forecasts upwards for the U.K.'s ad market, with growth rates predicted to reach 6 percent in 2014 and 6.7 percent in 2015, as TV enjoys a welcome lift from the World Cup.

According to the report, total U.K. advertising expenditure increased by 5 percent in the first quarter of the year to reach £4.5 billion ($7.7 billion); this is ahead of the 4.5 percent growth predicted in April.

Spot-TV advertising saw revenue increase by 6 percent in Q1, reaching £1.1 billion ($1.9 billion). This segment is expected to accelerate to 10.5 percent growth in Q2, with television getting a nice boost from the World Cup. However, this rate of increase will ease in the third quarter, reflecting the impact of budgets brought forward specifically for the tournament. For the full year, TV is forecast to see an increase of 6.5 percent compared to 2013.

VOD revenues are also expected to show strong growth. The report reveals that in 2013 broadcaster VOD revenues were worth £126 million ($216 million), up 21 percent. By the end of 2014 this is forecast to grow by 27 percent, and by 31.3 percent in 2015.

Tim Lefroy, the chief executive at the AA, said: “This latest adspend data are another nudge up for the economy, and a feather in the cap of U.K. global leadership in online and mobile, with consumers getting more value each day.”

Karen Fraser, strategy director at the AA, said: “This latest set of data shows the importance of global events such as the World Cup to advertising spend in the U.K. Following a positive start to the year in Q1, Q2 is set to be a strong quarter for the sector, buoyed by the tournament.”