Across the first half of 2014, total UK adspend rose by 6.3% year-on-year, leading to an upwards revision to the full year forecast to 6.4% (up 0.4pp from July’s forecast) and 6.5% for 2015 (down 0.2pp from July’s forecast).
Tim Lefroy, Chief Executive at the Advertising Association said: “Growth at twice the rate of UK GDP is quite a headline, but the real story is of digital and creative leadership in e-commerce. As the Eurozone wobbles, it’s a reminder that our consumer economy is central to the UK’s economic narrative.”
According to the AA, the Advertising Association/Warc Expenditure Report is the definitive measure of advertising activity in the UK. It is the only source that uses advertising expenditure gathered from across the entire media landscape. With total market and individual media data available quarterly from 1982, it is the most reliable picture of the industry and is widely used by advertisers, agencies, media owners and analysts.
Q2 performance was boosted by double-digit growth for TV, radio and internet and coincided with GfK’s UK Consumer Confidence Index moving back into positive territory at the end of June. Having declined for 21 of the previous 23 quarters, recruitment advertising has now registered three consecutive quarters of growth and was up 5.8% YOY for Q2 2014.
At-a-glance media summary:
• TV spot advertising recorded a significant rise of 10.7% YOY to £1,118m in Q2, boosted by the World Cup. Growth for the first six months stood at 8.3%, but this is expected to lessen in the second half. Overall an increase of 6.7% is predicted for 2014.
• Radio (excluding branded content) rose by 17.7% to £119m in Q2, with substantial increases for the retail and industrial categories. YTD radio adspend has risen 11.5%, with overall growth of 8.3% expected in 2014. This represents the sector’s best performance since 2000.
• Out of home adspend increased 6.4% to £259m in Q2 following a YOY drop of 2.2% in Q1. This takes OOH to 2.4% growth for H1 2014. AA/Warc predicts a rise of 3.4% for the year as a whole, thanks to ongoing technological advances.
• National newsbrands print ad revenues declined by 5.0% in Q2 2014 to £296m, with digital adspend up 9.9%, to £48m. Altogether the sector recorded a drop of 3.1% for the quarter and 4.1% for the first half. AA/Warc predicts a decline of 2.8% for the year.
• Regional newsbrands recorded a decline of 1.7% in adspend in Q2 2014 compared with last year. This represents a 5.2% drop for print (to £280m) and a 27.9% increase for digital revenues (to £44m). Forecasts have been revised up to a 5.0% drop in 2014 (+2.3pp).
• Magazine brands adspend dipped 6.7% in Q2, comprising a 10.2% decline for print (to £188m) and a 5.0% uptick for digital (to £66m). Total adspend is predicted to decline 3.3% this year.
• Cinema adspend saw YOY growth of 5.3% in Q2 2014 to £45m. It has seen an increase of 2.9% YTD with further growth is expected for Q3 (+11.4%) due to summer blockbusters and a weak corresponding quarter in 2013. AA/Warc forecasts overall growth of 6.7% in 2014.
• Internet adspend rose 17.2% in Q2 2014, following growth of 14.0% in Q1. This represents an increase of 15.6% for H1. AA/Warc anticipates overall growth of 15.1% in 2014. Expectations for mobile growth in 2014 have been moderated down from July’s forecast of 75% to 56%.
• Direct mail adspend recorded a YOY increase of 1.0%, to £461m in Q2 2014. The sector recorded an overall decline of 3.0% for H1, following a 6.7% fall in Q1. AA/Warc expects expect direct mail to see marginal growth in the second half, registering a full year decline of 1.0% in 2014.
