AA records 2 per cent adspend rise in 2005

Lack of confidence among consumers and the continuing depressed state of the economy restricted adspend in the UK to a modest 2.1 per cent rise last year, according to new statistics from the Advertising Association.

This compares with a 6 per cent rise in 2004. However, the internet underlined its credentials as a major advertising growth area with a 73 per cent rise in adspend to £1.1 billion.

"Last year was disappointing and the figures come as no surprise," Andrew Brown, the AA's director-general, said. "They reflect what we've seen in many company statements. There's no single reason for this, just the adverse economic conditions," he added.

A number of media suffered declines in advertising spend. They included national press (down by 3 per cent), radio (4.5 per cent), direct mail (3.9 per cent) and cinema (2.6 per cent).

Television and outdoor bucked the trend, however, delivering rises of 3.6 per cent and 5.8 per cent respectively. "Despite everything, some sectors have held up pretty well," Brown commented.

He acknowledged that the leap in internet advertising marked the medium's growing credibility. Brown added: "It's a big rise, albeit from a small base, but it shows that the internet is becoming a significant player. If you're looking for a job or a house, the internet is now the place to go."

Industry forecasters expect the downbeat situation to persist during the first quarter of 2006 but to improve during the summer as many advertisers release budgets in time for the football World Cup in Germany.