|
| Tuesday, 26 January 2021, 16:00 HKT/SGT | |
| |  | |
Source: Warc | |
|
|
|
|
| An upgraded forecast of 15.2% growth comes in the latest AA/WARC Expenditure Report published today, which also indicates better-than-expected results for 2020 |
LONDON, Jan 26, 2021 - (ACN Newswire) - The latest Advertising Association/WARC Expenditure Report expects the UK's ad market to grow by 15.2% this year, an upgrade of 0.8 percentage points from the last forecast in October 2020. The preliminary estimate for growth in 2020 now stands at -7.9% with adspend of GBP 23.17bn - a marked improvement (+6.6 percentage points) since the last outlook owing mostly to brighter prospects for online platforms.
The new forecasts show that the UK's ad market will make up for 2020's decline and accelerate further into growth this year, reaching a total of GBP 26.69bn - above the previous high of GBP 25.37bn recorded in 2019. Further, the decline seen in the UK's ad market during 2020 is estimated to be softer than the global rate (-10.2%) and that of the rest of Europe (-13.7%). The UK's projected ad market growth in 2021 is also expected to be ahead of key international markets, with the US expected to grow 3.8%, Germany 9.3%, Europe (excluding UK) 8.8%, and China 10.3%.
Internet adspend leads to stronger Q3 2020 performance
The latest dataset includes actual figures for Q3 2020 and predictions for the coming eight quarters. The key findings show that UK adspend fell 3.3% to GBP 5.9bn in Q3 2020. This was far better than the -17.9% forecast in October 2020, owing mostly to better-than-expected internet growth. Internet spend rose 10.1% to GBP 4.2bn during the quarter, buoyed by a 14.5% rise in search spend (which in turn was driven by e-commerce advertising). Overall, UK adspend was down 11.1% over the first nine months of 2020, at GBP 16.2bn.
Fast growth forecast for all media in 2021
Double-digit growth is expected across most media sectors in 2021 - and even triple-figure growth in the case of cinema. Particularly strong results are expected in cinema at 228.4% and reflective of the fact the sector was closed for most of 2020; digital out of home at 53.6%, traditional out of home at 37.7%, and video on demand at 21.2%.
Stephen Woodford, Chief Executive, Advertising Association commented: "The latest figures from the AA/WARC Report come as welcome news at the beginning of the year. Not only does the data show the overall decline expected in 2020 may be less than feared, but the recovery in 2021 will be stronger than we would have dared hope even a few months ago. With the vaccine rollout accelerating and a Brexit trade deal in place, the 2021 business outlook is brightening, reflected by these new forecasts showing a stronger and quicker recovery in adspend, with a stronger rebound than in other large economies. With every GBP 1 of advertising spend generating GBP 6 of GDP, this is good news for jobs and growth in the wider economy."
James McDonald, Head of Data Content, WARC commented: "The latest market data show that the largest online properties were shielded from the worst of the industry downturn last year. Indeed, with consumption and commerce migrating online during the pandemic, the results show that ad money followed to these platforms' benefit.
"Paid search - which accounts for over a third of all advertising spend in the UK - was the format that gained most from a surging e-commerce sector. Ancillary research by WARC shows that online sales recorded a six-year leap in penetration in 2020, as e-commerce's share of all UK retail value rose by 8.4 percentage points to 27.6%. This rate was ahead of China (24.9%) and double that of the US (13.4%) last year.
"The outlook for the year ahead is bullish, reflecting greater certainty around Brexit and the potential for the vaccination programme to unlock economic growth. We now believe that the ad market can overcorrect in these circumstances to top its 2019 peak, though large parts of the industry remain in a fragile state."
A sample copy of this latest report is available to download on lp.warc.com/Expenditure-report-sample-Q3-2020.html.
The Advertising Association/WARC quarterly Expenditure Report is the definitive guide to advertising expenditure in the UK with data and forecasts for different media going back to 1982.
Contact:
Amanda Benfell
Head of PR & Press
+44 20 7467 8125
amanda.benfell@warc.com
Topic: Press release summary
Source: Warc
Sectors: Media & Marketing, Advertising
https://www.acnnewswire.com
From the Asia Corporate News Network
Copyright © 2024 ACN Newswire. All rights reserved. A division of Asia Corporate News Network.
|
|
|
