AA/Warc: UK adspend set for record-breaking Q4
UK ad spend will reach £29.3bn this year after a record-breaking Q4, according to the latest quarterly Advertising Association/Warc Expenditure Report.
The report forecasts that UK ad spend will grow by 24.8% in 2021, 6.6 percentage points higher than the July forecast, the biggest annual increase on record.
These figures show that UK advertising is on track for the fastest recovery of any of the major European markets this year, in contrast to its decline of £1.8bn last year as the economy was rocked by the Covid-19 pandemic.
The report highlights double-digit growth in spend on many channels in Q2 2021, as well as predictions for the rest of the year and into 2022.
The AA/Warc figures come after media-buyers from the UK's major advertising groups told Mediatel News that October would be the biggest-ever TV trading month, thanks to a surge in advertising demand for the festive season.
Q4 2021 investment is predicted to be £7.9bn, the highest level recorded, £929m more than last year.
Search advertising was described as "one of the quickest growing media" of the quarter, increasing by 15.3% as consumers shopped online.
TV advertising is predicted to increase by the biggest margin in Q4 in over ten years, going up by 9.0% to £1,564m.
Within that, broadcaster video-on-demand advertising spend is expected to rise by nearly a quarter.
James McDonald, head of data content at WARC commented: “The latest data demonstrate bullish trade in the UK’s advertising sector despite potential inflationary headwinds and supply chain disruption in the run up to Christmas.
"Strong fourth quarter projections for TV – a medium heavily leveraged by retailers during the golden quarter – and search, which encompasses activity on eCommerce platforms, suggest it will be largely business as usual for the industry this year.”
Ad spend increase by channel in Q2 2021
Adspend increased by 86.5% to £7.7bn in Q2 of this year.
By channel, out-of-home spend grew by +276.8%, digital magazine brands by +155.5%, direct mail by +104.0% and online ad revenues for news brands from national digital and regional digital increased by +22.2% and +28.0% respectively.
2022 positive growth outlook
The findings also project a 7.7% year-on-year increase for 2022 to more than £31.5bn.
Cinema and out-of-home ad spend are predicted to grow by +123.2% and +27.7% respectively.
Search advertising, including ecommerce spend, will rise by +11.14%.