In Q1 2014, out of home advertising expenditure dipped 2.2% compared with the same period a year ago, according to the latest data released in the Advertising Association/Warc Expenditure Report. But this is expected to be just a temporary blip, and we forecast consistent growth throughout the rest of the year and into 2015.
We predict annual growth in the out of home sector of 2.7% in 2014, reaching a total of £1,017m. This is the first time the sector will have surpassed the £1bn mark. The pace of annual growth is expected to accelerate to 5.9% in 2015, or £1,077m.
After recording a dip in advertising spend in 2013, radio has started the year positively, according to the latest data from the Advertising Association/Warc Expenditure Report.
Traditional radio adspend (excluding branded content) totalled £426m in 2013, marking a 2.9% fall year-on-year and some £120m less than its peak nine years ago. In real terms (after accounting for inflation) the 2013 total was £337m, and representative of a 5.3% annual decline at 2005 prices.
But this looks set to change in 2014. Data show that radio adspend has started this year strongly, rising by 5.7% in Q1 compared with last year to £113m. This rate of growth is greater than the all-media total of 5% for Q1, suggesting things are looking up for the sector.
Clients often come to us saying their innovation is not having the impact they want: they need more ideas, or fewer bigger ideas, or they need to get them out in to the marketplace much more quickly. When we dig in to their Innovation Value Chain1 we frequently diagnose that the obstacle is not where they first thought.
Total UK advertising expenditure rose 5.0% year-on-year in Q1 2014, according to the latest data from the Advertising Association/Warc Expenditure Report released last week. We're predicting growth of 6.0% for the year as a whole and a further increase of 6.7% in 2015.
These are the headline figures – but what do they mean for the industry? There is often confusion when it comes to interpreting UK adspend data, because the AA/Warc is just one of the many organisations that release data in this field, and often the figures and forecasts seem very different to those from other sources. One of the main queries I receive at Warc tends to be "Why are your data so different to the numbers I've just seen from insert source organisation here?"
Last week Warc published the June results of its Global Marketing Index, one of the main ways we track current marketing activity in order to benchmark the health of the industry.
For those of you not familiar with this report, let me provide a bit of background. Back in October 2011, in partnership with World Economics, Warc launched the Global Marketing Index (GMI). Our aim was to provide a unique monthly indicator of the state of the global marketing industry by tracking current conditions among marketers all around the world. The data would also provide useful information for the financial markets relating to the state of global economic activity. Advertising expenditure has traditionally had a clear relationship with GDP, as you can see in the chart below.
This week we released our latest International Ad Forecast, taking the pulse of 12 key advertising markets to learn what the future will look like for adspend. In this edition, we have revised our forecast upwards by 1.2pp from October, expecting 2014 advertising expenditure to grow by 5.6% year-on-year in Purchasing Power Parity (PPP) terms – that’s the highest rate of growth since 2010.
But our 5.6% growth forecast for 2014 is before inflation. In real terms,
at 2005 prices, this growth amounts to 3.2%. A further rise of 5.3% –
2.7% in real terms – is predicted for 2015.
This blog by Emma Lane, Senior Research Executive at MEC, explores consumers' attitudes to targeted communications, data and privacy following MEC UK's Project Slipstream venture.
Consumer targeting and personalisation is becoming the norm in advertising. This is when brand communication is tailored to a consumer based on data collected about them (such as demographics or behaviour), making them highly relevant and more likely to be effective. This has been happening for a long time in online display, through practices such as behavioural tracking, where information collected from an individual's web browser behaviour is used to determine the ads served to them – and the practice is increasingly being used in ever more ways. Lloyds Bank targets offers to customers based on transaction history insights, while Tesco has installed face-scanning technology in its petrol stations to target queueing customers based on their age and gender.
The results from Warc’s Global Marketing Index in May indicate that marketers the world over remain optimistic, buoyed by rapidly improving trading conditions and strengthened budget setting across the board.
The headline GMI measure – which takes into account marketers’ expectations for trading conditions and marketing budgets, as well as staffing levels – recorded an index reading of 58.0 in May, a decline of 0.3 points from April but a 1.5 point rise from the previous year. A reading of 50 indicates no change, and above 60 indicates rapid growth.
As industrialist John Wanamaker famously put it: "Half the money I spend on advertising is wasted; the trouble is I don't know which half."
A fast moving, ever-evolving media landscape means brands have a plethora of media platforms to choose from to engage with their consumers and prospective customers. But an abundance of choice has made once relatively straightforward budget allocation decisions all the more challenging. Reaching the right consumer, with the right message at the right time, in the right environment has never been more complicated.
So which media channel will generate optimum ROI? We've dug into Warc's database of cases, articles and research papers to find some answers – and found two different approaches based around the 2010 World Cup, one of the biggest "brand events" there is.
National newsbrands recorded a decline in advertising expenditure of 4.8% overall in 2013, according to the latest data from the Advertising Association/Warc Expenditure Report released last week. While this total incorporates both print and digital advertising revenues, the increase for digital (+19.5%) is still not enough to offset the fall for print (-7.5%). But this looks set to change in 2015.
The long-term decline for print media, in terms of both advertising expenditure and circulation, is well documented. The trended data in the chart below show the rapid drop in print advertising spend for national newsbrands over recent years. The sector was worth £2.3bn at its peak in 2000, but had declined to just £1.3bn by 2013 – a fall of 43%.