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TV adspend passes £5bn

News, 24 February 2016

LONDON: Television advertising in the UK has passed the £5bn mark for the first time, helped by increased spending from online giants, according to new research.

Figures from Thinkbox, the TV marketing body – based on information from commercial broadcasters and measurement business Nielsen – revealed that revenues from TV advertising rose 7.4% to £5.27bn in 2015, marking six consecutive years of growth.

That is in line with data from Advertising Association/Warc Expenditure Report which recently highlighted a 10.8% increase in TV spending during the third quarter of 2015 and predicted a 7.8% increase for the whole year. Total adspend, it said, would break the £20bn barrier in 2015 for the first time.

Thinkbox highlighted the growth in spending by online businesses, the second largest TV advertising category. These had upped their expenditure by 14% to more than £500m, with Facebook, the social media giant, making its first foray onto the screen with an outlay of £10.8m.

Leading online firms such as Facebook, Google and Netflix, spent more than 60% of their marketing budgets on TV advertising, the research said.

"Online businesses in particular recognise the impact TV advertising has and have significantly increased their investment recently," said Lindsey Clay, chief executive of Thinkbox. "This is something we expect to continue in 2016," she added.

Facebook was just one of 877 advertisers that had taken out a TV advert for the first time in 2015, or returned to TV advertising after five years. Other high-spending newcomers included gaming company Machine Zone (£6.6m) and online estate agent network Agents Mutual Ltd (£5.9m).

These advertisers may have been encouraged by the declining cost of TV advertising – the research estimated it is now 30% cheaper in real terms than ten years ago.

Data from the Broadcasters' Audience Research Board indicated that FMCG giant Procter & Gamble was the most-viewed advertiser last year with 30.5bn views, followed by pay TV business Sky on 21.2bn views, with two more FMCG companies, Unilever and Reckitt Benckiser, each racking up 20.3bn views.

Data sourced from Thinkbox; additional content by Warc staff