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BizReport : Advertising archives : February 23, 2015

U.K. first country in which digital ad spend tops 50%

A new study from Strategy Analytics reveals more than half of ad spend in the U.K. will go towards digital this year, making it the first country in which this has happened.

by Helen Leggatt

The study forecasts that £8 billion (US$12.3 billion) will be spent on digital advertising in the U.K. during 2015. That figure represents 50.4% of total ad spend and is double that spent on television (£3.8 billion/US$5.8 billion) which accounts for 24%.

Print (£2.5 billion/US$3.8 billion) accounts for the next largest chunk (16%) while outdoor (£910 million/US$1.4 billion), radio (£492 million/US$757 million) and cinema (£179 million/US$275 million) will account for the remaining 10%.

In comparison, Strategy Analytics found that digital accounts for around a quarter of total ad spend in the U.S. and a third in Western Europe.

Online and mobile ad spend is forecast to grow 9.5% in 2015, compared to just 1.6% for traditional advertising. Overall ad spend in the UK is predicted to grow 5.4% to £15.8 billion (US$24.3 billion). After digital, cinema (4.8%) is the fastest growing ad format, followed by TV (up 3.0%), while outdoor will grow 1.1% and radio 0.3%.

Print is the only ad format forecast to decline in revenue although while growth rate was down 1.7% in 2014 it is forecast to be slightly less this year at 0.2%.

"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," says report co-author Michael Goodman. "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."

Tags: ad spend, advertising, digital, print, trends

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