The UK advertising market is relying on digital giants such as Google and Facebook for growth next year, as overall spending wanes on traditional media including TV and newspapers.
The amount spent by UK advertisers is forecast to break the £20bn mark for the first time next year, but the milestone is being passed due to continued high levels of digital advertising growth.
The amount spent on internet advertising will grow 8.6% next year to £12.8bn. The total UK ad market will rise 4.8% to £20.8bn, according to a report from the advertising media company GroupM.
“Digital is now around 60% of all advertising investment and accounts for all net UK advertising growth,” said Adam Smith, the futures director of GroupM. “Digital [is] commanding a rising share of overall marketing effort from a wider base of marketers large and small.”
GroupM said that overall spending on traditional media – including TV, newspapers and magazines, radio and outdoor sites such as advertising hoardings – will fall 0.7% next year.
Smith added that the growth in digital ad spending is coming predominantly from small and medium-sized businesses, with larger advertisers becoming “circumspect” about increasing digital investment.
Procter & Gamble, the world’s biggest advertiser and owner of brands from Gillette to Pampers, has cut hundreds of millions in digital ad spending that it considered ineffective. And Unilever, the world’s second largest advertiser and owner of brands from Marmite to Magnum, has warned that inappropriate content on online platforms such as Facebook and Google has at times made them “little better than a swamp”.
Television advertising is expected to grow by 1% next year to £4.36bn. ITV’s share price tumbled this month when it informed investors that it is to be hit by a slump of up to 8% in Christmas TV ad spending.
The overall decline in spending on traditional media next year is primarily being fuelled by the continuing fall in spending in print titles.
National newspaper advertising is forecast to fall 9.4%, from £843m this year to £764m in 2019, as increasing ad spending on publishers’ websites fails to reverse the overall ad revenue decline. The embattled regional newspaper ad market will see a fall of 8.8%, from £723m to £660m. And consumer magazine ad spending will drop 5.6%, from £371m to £351m.
The bright spots in traditional media are radio, where advertising is forecast to rise 7% to £535m; outdoor advertising, which will grow 2.7% to £964m; and cinema advertising, which will rise 1% £187m.
