Adspend levels surge in UK

15 October 2010

LONDON: Adspend levels in the UK posted a double-digit increase during the second quarter of this year, the most rapid growth for a decade.

Estimates from the latest AA/Warc Expenditure Report – a free summary of which, including PowerPoint charts, is available here – show ad revenues rose 11% year-on-year in Q2 2010.

Television registered a 24.2% improvement, with cinema reaching 25.5%, 17.7% for outdoor and 16.3% for the web.

Press and radio both saw demand strengthen by less than 1%, while direct mail experienced a 3.1% contraction compared with the corresponding period in 2009.

"Great global content, like the World Cup, has given traditional mediums such as TV, cinema and outdoor a much-needed boost this term," said Tim Lefroy, the Advertising Association's chief executive.

"People should note this has not been at the expense of digital. In fact, overall growth has been delivered hand-in-hand with the online sector."

Indeed, the internet's market share has jumped 2.4% for the year to June 2010, with TV gaining 1.7%, largely to the detriment of press and direct mail.

Display spend is expected to leap 7% in 2010, aided by television and online, each enjoying surges topping 10%, but business magazines and direct mail could continue to struggle.

Recruitment advertising endured a 9.1% drop during Q2 2010, and even though the rate of decline may soften slightly, full-year revenues are likely to be just half those recorded in 2008.

Led by paid internet search, other forms of classified are forecast to climb 4.3% in 2010, after a 2.3% slide last year.

Looking ahead, it was predicted total UK advertising returns will hit £15.3bn ($24.5bn; €17.4bn) over 2010 as a whole, an uptick of £0.8bn annually.

This is equivalent to a 5.4% improvement, and can be measured against the 3.3% expansion anticipated in the previous Expenditure Report.

Trends should stay positive all the way through to Q2 2012, although the pace of growth will average out at around 4% for the rest of 2010, before slowing further in 2011.

Regional press and direct mail are due to be the only channels to see ad sales decrease this year and next, as magazines follow up a negative 2010 by remaining flat in 2011.

Data sourced from Warc