UK adspend growth to plummet to below 1%

UK adspend growth will plummet this year to less than 1% amid uncertainty around Brexit and the result's of this month's General Election.

UK adspend growth to plummet to below 1%

Zenith latest global adspend report said the UK will suffer a sharp drop to 0.9% in 2017, down from 9.6% last year. 

Internet advertising, meanwhile, will account for more than 60% of all advertising expenditure in the UK next year at £11.1bn.

The drop-off in UK adspend growth is driven by an expected 4.9% contraction in the TV market to £3.79bn – the first contraction since 2012.

The UK had been the stand-out growth market in the Western & Central Europe region from 2011 to 2016, growing at an average of 7.3% a year.

However, Zenith’s report pointed to several factors pointing to a drag in adspend growth, such as the UK’s slowing economy, increasing inflation, and political uncertainty over the General Election and upcoming Brexit negotiations.

This drop in UK growth, together with the quadrennial comparison, will drag growth in Western & Central European adspend down from 4.5% in 2016 to 2.2% in 2017, and an annual average of 2.6% to 2019.

Zenith also predicts global ad expenditure will grow 4.2% in 2017, reaching $559bn (£437bn) by the end of the year – 0.2 percentage points below its previous forecast in March.

Vittorio Bonori, Zenith’s global brand president, said: "Global advertising budgets are rising steadily but cautiously, and are falling slightly behind overall economic growth.

"After a decade of cost-cutting since the financial crisis, we believe brands now need to focus on top-line growth. Our survey shows that brands are looking to data and technology as the main driver of business growth, closely followed by business transformation and new competitive positioning."