Digital to account for half of all UK ad spend this year

Half of all UK ad spend will be spent on digital for the first time this year, in what has been described as "seminal moment in the history of the ad industry".

Ad spend: digital will make up half of all spend for the first time in 2015
Ad spend: digital will make up half of all spend for the first time in 2015

Strategy Analytics has forecast that £8bn will be spent on digital advertising in 2015, more than twice the amount predicted to be shelled out on TV (£3.8bn). Print will rake in £2.5bn in ad spend, followed by outdoor (£910m), radio (£492m) and cinema (£179m). 

The UK remains ahead of the US when it comes to splashing out on digital ad spend – with the brands across the pond using just over a quarter of total ad spend on the channels, as TV continues to dominate brands’ ad spend in the US.

Online and mobile ad spend is forecast to grow 9.5% in 2015, compared to 1.6% for traditional advertising. The hike in ad spend will be driven mostly by mobile (23%), social media and video (both 18%). Search will continue to represent half of digital ad revenues.

The figures show the rude health of the ad industry, with overall UK ad spend predicted to increase 5.4% to £15.8bn during the year.

Elsewhere, the research said digital accounts for a third of ad spend in Western Europe and 30% globally.

Michael Goodman, co-author of Strategy Analytics’ report, said: "Digital crossing the 50% share threshold is a seminal moment in the history of the ad industry, particularly factoring in its dominance in the UK compared to globally.

"However, TV’s declining share is actually less about ad pounds flowing out of TV and more about them flowing into digital from print and radio. Thus, broadcasters such as ITV, Channel 4 and Sky will see little, if any, real decline in revenues – just a shift in the source from linear TV ads to online video."

Goodman predicts that digital’s share of ad spend will rise to 56% in the UK by 2018, and will be two and a half times that of TV (23%).

He signals that print will be the main victim of the rise in digital ad spend, with its market share falling to 12% in 2018 – less than a third it held a decade earlier.

  


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