WARC: U.K. Ad Spend Hit Record Level in 2021

Advertising expenditure in the U.K. hit a record £31.9 billion ($40 billion) in 2021, a year-on-year growth of 34.3 percent, according to new Advertising Association/WARC figures.

Television advertising rose 24.1 percent to £5.4 billion ($6.8 billion), with BVOD rising 40.2 percent to £732.8 million ($924 million).

This year, the ad market is forecast to expand by 10.7 percent to £35.3 billion ($44 billion), driven by a strong start to the year, higher CPMs and higher demand ahead of the FIFA World Cup. The forecast for 2023 is 5.4 percent to reach £37.2 billion ($46.9 billion), but supply chain disruptions and cost of living increases could hamper growth.

Stephen Woodford, chief executive of the Advertising Association, noted, “The U.K. has held its position in 2021 as the largest advertising market in Europe through the pandemic and is now the third largest in the world, behind the U.S. and China. While further growth is forecast, inflationary pressures on the cost of advertising and more generally, due to the ongoing geo-political uncertainties, mean we should be cautious.”

James McDonald, director of data, intelligence and forecasting at WARC, added, “The Covid-19 recovery last year was buoyed in part by the release of pent-up investment on established online platforms—as well as maturing ones such as TikTok—and in part by the emergence of retail media as a major contender for marketing budgets. The latter trend bears the hallmark of a new era in advertising, one which is set to fuel growth over the forecast period and beyond. Be that as it may, economic headwinds create uncertainty ahead; the consumer is being stretched further than at any other time since the Second World War, conflict in Europe has stoked market volatility and has exacerbated supply chain pressures, and the prospect of a U.K. recession cannot be ignored. Given the market’s current momentum, however, we do not yet see this translating into an advertising recession over the coming quarters.”