Online-Driven UK Adspend Could Soar 37% by 2012

21 January 2008

LONDON: There's mixed news about the future for Adland UK. A worst-case scenario shows adspend rising over the next twelve years by just 16.8% to £18,600 million. But there's also a much cheerier vision: if the economic sun shines, spend will soar 37.9% to £22m.

Britain's Advertising Association - representing 31 trade bodies in the advertising and promotional marketing industries - posits both options.

In terms of compound annual growth rate, this translates as 2.5% on the high option, but a mere 1.2% on the low.

But whichever way the cookie crumbles, expenditure growth will be internet-led, according to the Long Term Advertising Expenditure Forecast, compiled for the AA by the World Advertising Research Center.

In terms of display advertising, online is expected to increase its market share from 3.9% in 2006 to 12% in 2019. Online classifieds are also predicted to rise sharply.

On the high option, the internet is forecast to achieve a compound annual growth of 11.6%; whilst even on the low option CAG is expected to be in the region of 10%.






In addition to online, the report covers TV, national newspapers, regional newspapers, consumer magazines, business magazines, directories, radio, outdoor/transport, cinema and direct mail.

Both options exclude price inflation and are expressed in terms of £ millions at constant 2000 prices. The figures for 2007 are provisional.

Predictions are based on the expected future performance of UK business, which is itself dependent on the health of the global economy.

This, coupled with the number of fast-growing economies around the world, notably in Asia, means that global economic growth patterns are likely to be closer to those witnessed in the 1990s than the 1970s or the 1930s.

Cycles are likely to become longer and downturns will have a less debilitating effect on the long-term economic situation. For these reasons, it expected that a major recession will not hit the UK within the forecast period.

However, the report does not rule out the possibility of recession in the near future and warns of its concomitant ill effect on all adspend forecasts.

To obtain the full report click here.

Data sourced from Advertising Association (UK); additional content by WARC staff