UK Digital Ad Spend reaches record £13.44bn

The latest figures revealed by IAB UK and PwC Digital show that UK advertisers spent £13.44 billion on digital advertising in 2018.

This figure represents a 15 percent year-on-year increase, and a rise of around £1.8bn compared to 2017. This demonstrates continued confidence in the market about the power of digital advertising.

An analyst commented: “The flexibility and measurable performance of top online advertising platforms attracts small businesses, trade promotion budgets and big brand advertisers alike”.

Smartphone advertising drives growth

As in 2017, almost all of the growth in 2018 came from from smartphones. Now 51% of all digital advertising is on smartphone, representing the changing behaviour of consumers.

Search advertising still leads the way

Search advertising continues to dominate the total digital advertising spend, accounting for £6.72bn – that’s 50% of total ad spend in the UK in 2018.

This is closely followed by display advertising at 39%. Display includes things like display banners, video, sponsored content, and social in-feed video. Video is now the largest display format, with 44% of overall spend in this category.

UK Ad Spend 2019
Credit Source: IAB 2018 Digital Adspend Study

Experts commented: “As the quality of smartphone handsets continue to improve … users are spending more time consuming more video content on their phones. And the more content that is consumed the more ad opportunities they are presented with”.

Further growth forecasted

The wider uncertainty in the market doesn’t seem to have dampened spend. In signs of further growth in 2019, the IAB is reporting that UK ad spend rose 5.8% to reach £6 billion in Q2 2019 (April – June 2019). This marks UK advertising’s 24th consecutive quarter of market growth. A breakdown of performance and forecast figures across all channels including more traditional methods are shown below.

2019 forecasts
Credit Source: AA/WARC

The trend of steady growth continues, which means that a robust digital marketing strategy needs to be in place for businesses that want to succeed in the new digital-first economy. If you need help with your digital marketing strategy, get in touch.