Retail forecast to power digital adspend through 2018

Thanks to the growth of e-commerce in the UK, the retail sector is set to be the biggest spender on digital advertising this year and is expected to continue to do so next year.

E-commerce giants such as Amazon are pushing advertising investments online and on mobile
E-commerce giants such as Amazon are pushing advertising investments online and on mobile

According to eMarketer, retail will outspend automotive, consumer packaged goods and consumer products, financial services and travel on digital advertising. 

The sector is expected to account for 14.2% of all digital adspend in 2017, with investment up 13.4% to £1.55bn. In 2018, retail will increase its adspend by 11.8% to £1.73bn. 

Within this, mobile will get two-thirds of retail digital adspend with investment ballooning by 31% to reach £1.04bn this year. 

"The retail sector has a wide array of product categories, ranging from household staples such as groceries to highly popular consumer electronics and gadgets," Monica Peart, eMarketer's senior forecasting director, said. "This helps to not only push retail ad spending above other sectors, but also makes it one of the fastest growing categories with pure-play e-commerce giants such as Amazon pushing advertising investments online and on mobile, where the shopper is increasingly making purchase decisions."

The other industries tracked by eMarketer will likewise increase their digital adspend in 2017, but by slightly more modest levels. 

The other core industries in the UK tracked by eMarketer will also grow their digital ad spending in 2017, albeit by slightly more modest levels.

Both automotive and consumer packaged goods are expected to grow by 11% respectively, followed by travel (9.3%) and financial services (9.2%).

As with retail, these industries will also see mobile adspend swell by more than one-quarter in 2017, with increases ranging from 27% for travel to 30% for automotive.

An earlier report by eMarketer estimated the UK's total mobile ad spend this year to total £7bn, about a third of the £18.8bn digital ad market.