AA/Warc: Online growth sees Q3 adspend levels beat forecasts
UK adspend rose 5.6% year-on-year to reach £5.97bn in Q3 2019, 0.8 percentage points ahead of forecast.
The figures, issued by Warc and the Ad Association on the same day as the latter's annual Lead conference, mark the industry's 25th consecutive quarter of market growth.
Looking ahead to the full-year figures for 2019, UK adspend is now forecast to reach £24.8bn, meaning growth of 5.2%. This is expected to rise a further 5.2% in 2020 to reach £26.1bn.
Overall market growth is being driven by increased spend on online advertising, which saw percentage increases across every format.
This was led by digital out-of-home which rose by 17.1%, TV broadcaster VOD which saw a rise of 16.7% and national online newsbrands which saw growth of 6.5%.
The report also demonstrates strong growth in Q3 2019 compared to the same quarter in 2018 in cinema advertising, which saw a substantial rise of 46.5%.
Despite the good news, Warc data editor James McDonald said the growth is "asymmetric".
"Excluding online advertising, the UK’s ad market has contracted each quarter for the last four years," he said.
"Online formats account for three in five pounds spent on advertising in the UK, and we expect this to rise to two in three by mid-2021, fuelling total market growth in tow.”
Meanwhile, Stephen Woodford, chief executive of the Ad Association, added that the spend figures were particularly impressive given Q3 2019 was a period of very low overall economic growth and said the online growth was in part fuelled by "exceptional growth" in SME spend.
"The projected growth for 2020 shows these trends continuing," he said. "With Brexit now a certainty, industry’s focus now turns to the future relationship with the EU and the importance of this to the overall health of the economy, which underpins this media spend growth.”