Agency models and planning approaches will need to become less channel-centric over the next five years, according to IAB UK's new study Futurescape. The report explores how media owners are becoming increasingly channel-agnostic and how the rise of end-to-end ad solutions through partnerships, collaborations and - in some cases - mergers with retail media platforms stand to fundamentally reshape the path to purchase in the lead up to 2030.
The demise of the traditional media funnel will be accelerated by AI’s impact on how people discover and purchase products in the coming years. In this context, IAB UK predicts that brand marketing will become more important than ever - helping to create differentiation and win consumers’ attention in environments where instantly shoppable formats are the default.
Futurescape has been created by IAB UK - the trade body for digital advertising - to explore the attitudes, innovations and media shifts that will shape the advertising industry in the lead up to 2030 and beyond.
According to IAB UK, it draws on qualitative interviews with over 40 leaders from across the advertising, media and technology industries (see list of contributors below); extensive analysis of existing research from a wide range of sources; and original forecasting conducted by economist and media analyst Dr Daniel Knapp, who employed statistical modelling to plot spend trends to 2030.
The report focuses on 11 areas that will fundamentally shape advertising and media by the turn of the decade, added IAB UK. From all media becoming retail media, to redefining demographic targeting, it provides a comprehensive picture of what’s to come - as well as laying out the implications for advertisers and steps to future-proof businesses, IAB UK continued.
Ad spend forecasts to 2030
Futurescape’s ad spend forecasting draws on IAB UK/MediaSense Digital Adspend data and IAB/MTM Compass data and applies statistical modelling to predict spend trends for key areas of growth in the UK’s advertising market.
It shows that, by 2030, total digital ad spend in the UK is set to stand at £43.1 billion - over a £10 billion incremental increase on current investment. While still healthy, this does reflect slowing annual growth rates as the market matures, with an average of 5% growth per year between 2024 and 2030. This will be outstripped by performance in key areas, including:
- Video display, which is expected to grow at twice the rate of the overall market, accounting for 34% of all digital ad spend by 2030 (£14.7 billion) . Within this, spend on broadcaster video-on-demand is predicted to exceed £2 billion as TV viewing habits continue to shift towards streaming
- Digital retail media ad spend is forecast to reach £8.6 billion in the UK by 2030, with annual growth rates peaking in 2025/26 at 30%. This is set to have steadied to 8% annual growth by 2030 as the market matures
- Gaming spend is on track to grow by 48% by 2030 - displaying an average annual growth rate of 7% over the next five years - to hit £1.6 billion
- Ad spend on Gen AI platforms is the most complex area to predict as ad solutions are still nascent in these environments. The likeliest scenario, assuming development and uptake of ad solutions evolves as expected, is that ad spend on Gen AI platforms (encompassing websites and apps of platforms listed below) will stand at £3.34 billion by 2030
Commenting on the release of Futurescape, IAB UK’s Chief Strategy Officer,
James Chandler, says: “Futurescape isn’t a one-off project for us at the
IAB. It’s the start of an ongoing and multi-dimensional exploration of the
social shifts and technological advancements that will shape our industry.
We all know that the rate of change in advertising and media can feel
overwhelming, but by drawing on our experts’ analysis and the wealth of
knowledge from leaders across the industry, we’re equipping businesses with
the insight they need to stay ahead of the curve. This isn’t just about
ensuring your business is fit for the future, it’s about being equipped to
define the future, seize opportunities and thrive in a dramatically shifting
landscape.”
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