Digital ad spend sees biggest full-year growth in 15 years

IAB says the 41% increase demonstrates that the industry is bouncing back after the pandemic.

IAB UK: the report demonstrated a 61% increase in investment in podcast advertising
IAB UK: the report demonstrated a 61% increase in investment in podcast advertising

Digital ad spend surged to £23.5bn in 2021, according to IAB UK’s Digital Adspend report, conducted with PwC.

The figure was a 41% increase on 2020’s £16.5bn in digital ad spend.

Compared with 2019, the last time the figure was unaffected by the pandemic, it was up by 50% from £15.7bn.

Search was the largest share in overall spend at 50%, with £11.7bn being spent on paid listings within general search services. Search shopping ads made up £3.5bn of this figure.

Display ads, including social and non-social, accounted for £9.7bn of total ad spend. 

Meanwhile, social display accounted for 27% of total spend. Display, excluding social, made up 14% of the total number.

Video made up £5.5bn of the £9.7bn spent on display ads.

The remaining 9% of total digital spend was made up of classified and other ads. These included podcasting, ads in and around video games, and affiliate display. Podcast investment was at £54m – an increase of 61% on 2020 – and static and in-game video advertising was at £9.8m.

Stephanie Claxton, senior manager, digital and programmatic at PwC, commented on the rebound for 2020 and added: “The growth has been felt by so many different facets of the industry from traditional display to video, podcasts to in-game. 

“Clients appear to be diversifying their investments and working with a wider range of formats and suppliers. It’ll be incredibly interesting to see if this trend continues in the year ahead.”

Across these formats, 60% of total spend was on mobile at £14.1bn. This was an increase of 43% from £9.9bn in 2020.

Jon Mew, chief executive of IAB UK, said the figures were a “testament to the resilience” of the industry.

He added: “However, we shouldn’t lose sight of the fact that 2021 still wasn’t a normal year. We spent half of it in some form of lockdown – bringing with it an increased reliance on digital channels – while the return of large-scale events such as the Olympics and Paralympics in H2 will also have impacted spend. 

“Ultimately, while growth on this scale is truly brilliant to see, what matters most is how we sustain investment in the long term, beyond recovery and in the face of growing regulatory scrutiny. As an industry, we should take confidence from the results announced today and channel that into pulling together to ensure a sustainable future for digital advertising.”


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