Spend increased by 3.8% year-on-year (excluding direct mail*), exceeding earlier forecasts by 0.9 percentage points. Total advertising spend for the same period was £4.2bn (including direct mail).
Growth in Q2 2012 was driven by the Jubilee and Euro 2012, as well as some advertisers moving budgets forward from Q3 in light of the Olympics.
The challenging global economic outlook means advertising’s prospects for the rest of 2012 and 2013 are not as strong as previously anticipated. Nonetheless, advertising spending is expected to grow by 2.1% in 2012 and 4.1% in 2013 (excluding direct mail). In total, advertising is forecast to be worth £16.8bn in 2012 and £17.4bn in 2013 (including direct mail).
The AA/Warc Expenditure Report provides the most comprehensive measure of UK advertising activity. It includes an overview of advertising spend across all media, spanning print, TV, internet, radio, cinema and out of home.
Cinema enjoyed the biggest Q2 increase of 23.9%, leading internet (14.8%), radio (9.4%), television (4.4%) and out of home, which enjoyed a pre-Olympics boost of 9.9%.
Press, however, was the one sector that performed worse than forecast. Press was forecast to decline by -7.5% in 2012, but actually declined by -11.7.
Tim Lefroy, Chief Executive at the Advertising Association, said: “Advertising continues to enjoy solid growth prospects. It remains a potent tool for boosting consumer spending and getting money flowing round the economy again.”
Suzy Young, Data Editor at Warc, added: “The forecast for UK adspend strengthens in 2013 as inflation subsides and real disposable income increases for the first time since the financial crisis.”
(*Direct Mail: The methodology for collecting direct mail data changed from Q1 2012 onwards. Because of the different methodologies, we are unable to compare figures for direct mail between years. Figures comparing different periods do not include direct mail. However, figures expressing the overall value of advertising spend in a period do include direct mail.)
About the Advertising Association/Warc Expenditure Report
The Advertising Association says: The Advertising Association/Warc Expenditure Report is a comprehensive, quarterly review of advertising spend on all major UK media. All data is net of discounts and includes agency commission, but excludes production costs. The survey was launched in 1982, and has produced data on a quarterly basis since.
The Expenditure Report launched in February 2010 and is available exclusively online only; subscribers will be able to access over 150 standard tables, build their own tables for different media and time periods, download bespoke analysis and track different media sectors’ share of adspend via a new tool. An annual subscription to the AA/Warc Expenditure Report costs £1,025. Members and affiliates of the Advertising Association pay a discounted price of £660.
Methodology
The press data is derived from information provided directly by publishers of national newspapers, regional newspapers and business and consumer magazines. Television data is based on figures provided by various industry sources including Ofcom. Radio, Outdoor and Cinema data comes from the Radio Advertising Bureau (RAB), Outdoor Media Centre (OMC) and the Nielsen Company respectively. The Royal Mail provides direct mail expenditure. Internet data is based on the Internet Advertising Bureau (IAB) survey carried out biannually by PricewaterhouseCoopers, and a survey of online recruitment specialists carried out by Warc. Sponsorship and promotions expenditure data has been excluded from the totals for both TV and radio for consistency purposes, as quarterly figures are not yet available for TV.
