LONDON: Digital growth across all channels helped the value of UK advertising increase 5.8% in 2014, the highest rate of growth since 2010 according to data from the Advertising Association and Warc.

Full-year figures from the Advertising Association/Warc Expenditure Report – a definitive measure of advertising activity in the UK, being the only source that uses advertising expenditure gathered from across the entire media landscape – show that UK advertising revenues hit £18.6bn last year.

Internet advertising (+15.0%) and mobile (+58.9%) continued to grow strongly but digital advertising through traditional channels also took-off in 2014.

Broadcast video-on-demand (+15.1%), digital national (+16.4%) and regional (+24.7%) newsbrands were stand-out performers but the upward trend was also reflected in magazines and outdoor.

"It's time to stop thinking of digital as something that lives on the internet," declared Tim Lefroy, chief executive of the Advertising Association.

"In cinemas, outdoor, news, television and elsewhere, advertising is seizing the opportunity of new technology – that trend is transforming our media, driving growth and keeping UK advertising ahead of the global competition."

Mobile now accounts for just over 22% of internet spending on £1,623m (up from a 10% share in 2012) and the report expected this share would increase to just over one third by 2016, with growth rates of 43.8% and 34.2% forecast for the next two years.

TV spot advertising benefited from last summer's football World Cup, increasing 5.4% year on year to reach £4,463m. But growth is expected to slow to 4.4% in 2015 before starting to pick up again in 2016, to 4.6%.

Broadcaster VOD, which advanced 15.1% in 2014, is set to pick up more rapidly in subsequent years, with AA/Warc predicting increases of 17.2% and 20.6% for 2015 and 2016 respectively.

Out of home adspend rose 3.0% last year to pass the £1bn mark for the first time, helped in no small part by a 27.3% growth in digital revenue, which now accounts for over a quarter of the total.

While digital ad revenues had risen rapidly at national newsbrands (+16.4% to £214m), this was not enough to offset the decline in print (-7.7% to £1,156m).

The Report did see an end in sight, however, as continued digital growth was slowing the overall decrease in spending, to -1.8% in 2015 and just -0.2% in 2016.

A similar picture emerged among regional newsbrands, although with total adspend projected to decrease -3.7% this year and -2.4% in 2016 this sector will not have bottomed out by the end of the forecast period.

Total UK adspend is set to grow at 5.6% in 2015 and 5.4% in 2016, by when it will have exceeded £20bn.

"Overall growth of 5.8% last year was the strongest since the start of the economic recovery in 2010," James McDonald, research analyst at Warc, noted. "We expect this to maintain, with one of the best growth periods forecast for more than a decade.

"Two in every five pounds spent on advertising in 2014 were via digital channels. With digital aiding growth across all media, brands and marketers have been chameleon-like in their adaptation to new technology."  

Data sourced from AA, Warc