Warc special report: the UK ad market’s mobile growth drive

In the third of our exclusives articles examining the latest AA/Warc Expenditure Report, Suzy Young, Warc’s data and journals director, looks at how mobile devices have impacted marketing budgets over recent years.

It’s not exactly news that the internet has been one of UK advertising’s biggest success stories over the last decade. Total internet advertising expenditure hit £6 billion in the UK in 2013, following growth of 15.6% compared with 2012, according to the latest Advertising Association/Warc Expenditure Report which we released on Monday.

Looking ahead, we predict further year-on-year growth for internet in excess of 12% for both this year and next.

Subscribers to the Expenditure Report are able to track long-term datasets for the different ad sectors, and will know that internet spend has grown by a staggering 4,000% since 2000, when total revenues stood at just £153 million.

Internet spend bolstered total UK main media advertising spend throughout the recent recession and was the only medium not to record a year-on-year decline at any point since 2000. Growth dipped from its usual double digits to 5.7% in 2009 – partly due to the economy-led drop in recruitment advertising – but picked up to 15.7% the following year.

Put simply, marketing budgets have shifted over recent years to reflect changing consumer behaviour. We have become ever more connected via our smartphones, tablets and other digital and mobile devices.

Over recent years, marketing people have very often talked about the ‘year of mobile’. According to the data, this year was 2013. Mobile was a strong driver of total internet growth last year and now accounts for just over a 16% share of total internet spend on £1.032 billion (up from a share of just 4.2% in 2011).

And, as we become ever more dependent on our smartphones, this adspend trend is set to continue. Following growth of 95% in 2013, we expect mobile adspend to grow by a further 73% this year and by 46% in 2015, reaching a total value in excess of £2.5 billion by the end of the forecast period. It is also expected to take a 32% share of total internet adspend at this point – an eightfold increase since 2011.

Commenting on the findings, IAB’s CEO, Guy Phillipson said: “With smartphone penetration likely to pass 75% of the UK population in 2014, it’s no surprise that mobile ad spend hit £1 billion in 2013.

“As more and more advertisers optimise their businesses for mobile and m-commerce, rapid growth in adspend is bound to continue, driving total advertising in the UK to new highs.”

To find out more about subscribing to the AA/Warc Expenditure Report please visit the website or contact Suzy Young for additional information.

MediaTel subscribers can also now gain access to adspend and revenue figures by medium and aggregated forecast trends by medium from AA/WARC, Carat, eMarketer, GroupM and ZenithOptimedia in the new Media Landscape tool.