The Media in Figures: UK advertising spend

RESEARCH released last week has estimated that UK advertising spend grew at its fastest rate for three years during the months of April to June this year.

According to figures in a regular snapshot of the sector – by the Advertising Association and advertising analysts, Warc – growth of 8.5 per cent year-on-year (reaching £4,515 million for the quarter) was the highest since Q3 2010.

Says a report published last Tuesday: “Across the first half of 2014, total UK adspend rose by 6.3 per cent year-on-year, leading to an upwards revision to the full year forecast to 6.4 per cent (up 0.4pp from July’s forecast) and 6.5 per cent for 2015 (down 0.2pp from July’s forecast).”

In summary, the report revealed:

*  TV spot advertising recorded a significant rise of 10.7 per cent year-on-year (YOY) to £1,118m in Q2, boosted by the World Cup. Growth for the first six months stood at 8.3 per cent, but this is expected to lessen in the second half. Overall an increase of 6.7 per cent is predicted for 2014.

* Radio (excluding branded content) rose by 17.7 per cent to £119m in Q2, with substantial increases for the retail and industrial categories. Year-to-date (YTD) radio adspend has risen 11.5 per cent, with overall growth of 8.3 per cent expected in 2014. This represents the sector’s best performance since 2000.

* Out-of-home (OOH) adspend increased 6.4 per cent to £259m in Q2 following a YOY drop of 2.2 per cent in Q1. This takes OOH to 2.4 per cent growth for H1 2014. AA/Warc predicts a rise of 3.4 per cent for the year as a whole, thanks to ongoing technological advances.

* National newsbrands print ad revenues declined by five per cent in Q2 2014 to £296m, with digital adspend up 9.9 per cent, to £48m. Altogether, the sector recorded a drop of 3.1 per cent for the quarter and 4.1 per cent for the first half. AA/Warc predicts a decline of 2.8 per cent for the year.

* Regional newsbrands recorded a decline of 1.7 per cent in adspend in Q2 2014 compared with last year. This represents a 5.2 per cent drop for print (to £280m) and a 27.9 per cent increase for digital revenues (to £44m). Forecasts have been revised up to a 5.0 per cent drop in 2014 (+2.3pp).

* Magazine brands adspend dipped 6.7 per cent in Q2, comprising a 10.2 per cent decline for print (to £188m) and a five per cent uptick for digital (to £66m). Total adspend is predicted to decline 3.3 per cent this year.

* Cinema adspend saw YOY growth of 5.3 per cent in Q2 2014 to £45m. It has seen an increase of 2.9 per cent YTD with further growth is expected for Q3 (+11.4 per cent) due to summer blockbusters and a weak corresponding quarter in 2013. AA/Warc forecasts overall growth of 6.7 per cent in 2014.

* Internet adspend rose 17.2 per cent in Q2 2014, following growth of 14 per cent in Q1. This represents an increase of 15.6 per cent for H1. AA/Warc anticipates overall growth of 15.1 per cent in 2014. Expectations for mobile growth in 2014 have been moderated down from July’s forecast of 75 per cent to 56 per cent.

* Direct mail adspend recorded a YOY increase of one per cent, to £461m in Q2 2014. The sector recorded an overall decline of 3.0 per cent for H1, following a 6.7 per cent fall in Q1. AA/Warc expects expect direct mail to see marginal growth in the second half, registering a full year decline of one per cent in 2014.

Source: Advertising Association/Warc Expenditure Report, October 28 2014.