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UK to break digital ad spend record in 2015

December 4, 2014
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Blog
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Posted by David Hobart

Well, it’s finally happened: as more and more publishers navigate the tricky path toward digitalising their content, and more and more consumers indulge their obsession with tablets, smartphones, online shopping and social media, the UK is poised to become the first country on the planet to divert over half of its advertising spend to digital media.

The forecast comes from Group M, the media investment management wing of communications and market services giant WPP. In 2015, out of a total UK ad spend of £15.7bn, online spending will be over £8bn, a year-on-year rise of 12.7 per cent.

In other words, the UK will spend more money on online advertising than on traditional media such as TV, cinema, newspaper, magazines, radio, posters, buses and billboards put together.

Adam Smith, Group M’s futures director, said:

“The British are the most enthusiastic online shoppers in the world in terms of spend per head. And there has always been a high level of credit and debit card use [online]. On top of that Britons have rapidly embraced smartphone and tablet use, all of which has fuelled where advertisers spend their money.”

So just where will this £8bn+ go? Group M believes £4.2bn will go to paid search advertising, with Google sucking in most of the 29 per cent of that which will go towards mobile devices. Display advertising emerges as the fastest growing segment of the online market, surging by 20 per cent to hit the £2.7bn mark in 2015 (39 per cent will go to mobile advertising).

The UK newspaper market will lose over £160m, with advertising spend on national titles contracting by 8.3 per cent to £908 million next year (a year-on-year fall of £80m). Regional newspapers will see a 9.1 per cent decrease in print ad revenues, a year-on-year decline of £82m.

The best that newspaper brands can hope for, says Smith, is to recoup about 20 per cent of the money lost to print advertising by expanding their digital revenues.

This year, around 10 per cent of newsbrand revenue is digital. Smith believes they’ll need to align with the biggest drivers of online display – mobile, social and video.

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