On the heels of an 8.8 percent increase in 2022 to reach \u00a334.8 billion ($43.5 billion), the U.K. advertising market is expected to be flat this year, inching up to \u00a335 billion ($43.8 billion), before returning to growth in 2024, according to new data from the Advertising Association\/WARC Expenditure Report.<\/p>\n
AA\/WARC is projecting just 0.5 percent growth this year following the Q4 2022 fall of 5.8 percent\u2014the first time the ad market has contracted in the fourth quarter since 2009. The market had previously been forecast to rise by 3.8 percent this year but AA\/WARC has revised its forecasts given the headwinds of high inflation, muted growth and talent shortages across the industry.<\/p>\n
Cinema and out-of-home led the gains. Overall TV slipped by 1.4 percent in 2022 to \u00a35.4 billion ($6.7 billion), while BVOD rose 15.4 percent to \u00a3845.3 million ($1.06 billion). AA\/WARC projects TV adspend will fall by 2 percent this year, with BVOD rising 2.5 percent. In 2024, TV is expected to grow by 1.6 percent and BVOD by 3.6 percent, with the overall ad market increasing by 3.9 percent to reach \u00a336.3 billion ($45.4 billion).<\/p>\n
Stephen Woodford, chief executive at the Advertising Association, noted: \u201cThese figures reflect the broader macro-economic environment, with a cautious outlook as the U.K. economy narrowly avoids recession, but shows very little signs of real growth. Advertising investment is an important barometer of business performance and confidence in the economic outlook. It drives competition and innovation, supporting job creation and livelihoods, returning a ration of \u00a31 invested generating \u00a36 of GDP.\u201d<\/p>\n
Annette King, chair of the Advertising Association, added: \u201cIt\u2019s clear from these figures that the U.K. needs a strong plan for growth, one that capitalizes on the advertising industry\u2019s talent to help businesses innovate and compete, and support jobs and livelihoods up and down the country. At the same time, we need to address the talent shortages faced by our industry\u2014for example, working with government to increase flexibility in apprenticeships, and answering the demand for digital skills and expertise which will equip our workforce for the future.\u201d<\/p>\n
James McDonald, director of data, intelligence and forecasting at WARC, said: \u201cThe latest verified media data reveals that the U.K.\u2019s ad market entered recession in the second half of 2022, with clear signs that the downturn has continued into the opening months of this year. Sharp and sustained falls in social media spend\u2014the first time this has been recorded in the U.K.\u2014are likely to have been instigated by reduced advertising activity among the SMEs who comprise a \u2018long tail\u2019 of ad volume on social platforms and whose margins are under incredible stress as inflation bites. One in every 202 U.K. companies entered liquidation in 2022, the highest rate in seven years, and it is unsurprising to see these pressures reflected to some degree within advertising trade.\u201d<\/p>\n
McDonald added: \u201cTrading conditions are not expected to improve until the second half this year, with economic activity and advertising investment both largely flat during 2023 as a whole. The outlook is set to improve next year, however, as the economy returns to growth, inflation falls nearer to the government\u2019s 2 percent target and consumer confidence lifts, though advertising spend is still predicted to rise below its long-term average in 2024.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"
On the heels of an 8.8 percent increase in 2022 to reach \u00a334.8 billion ($43.5 billion), the U.K. advertising market is expected to be flat this year, inching up to \u00a335 billion ($43.8 billion), before returning to growth in 2024, according to new data from the Advertising Association\/WARC Expenditure Report.<\/p>\n","protected":false},"author":290,"featured_media":12426,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[75,69],"tags":[1175,1880],"class_list":["post-12425","post","type-post","status-publish","format-standard","has-post-thumbnail","","category-analysis","category-top-stories","tag-advertising-association","tag-advertising-associationwarc-expenditure-report"],"yoast_head":"\n