Digital spend soars but IAB chief warns ‘don’t get cocky’

digital_2Digital advertising spend rocketed by more than 40% from £16.5bn in 2020 to £23.5bn in 2021 as the seemingly Teflon-coated discipline continued its dominance of the market.

And, according to IAB UK’s Digital Adspend report conducted with PwC, compared to the pre-Covid 2019 figures, digital ad spend was up by 50% from £15.7bn.

The biggest winner was on mobile, which secured 60% of total spend – a whopping £14.1bn, and up 43% from £9.9bn in 2020.

With many disciplines – including outdoor, cinema, TV and to a lesser extent direct mail – being rocked by total Covid wipe-out, digital escaped virtually unscathed as advertisers ploughed more budget online to target lockdown consumers.

Search grabbed the largest slice of overall spend gobbling up 50%, with £11.7bn being spent on paid listings within general search services. Search shopping ads represented£3.5bn of this figure.

Display ads, including social and non-social, accounted for £9.7bn of total ad spend. Meanwhile, social display secured 27% of total spend. Display, excluding social, made up 14% of the total number and video accounted for £5.5bn of the £9.7bn spent on display ads.

The remaining 9% of total digital spend was spent on classified and other disciplines, including podcasting, video games, and affiliate display. Podcast investment was at £54m – an increase of 61% on 2020 – and static and in-game video advertising was at £9.8m.

PwC senior manager, digital and programmatic Stephanie Claxton said: “The growth has been felt by so many different facets of the industry from traditional display to video, podcasts to in-game.

“Clients appear to be diversifying their investments and working with a wider range of formats and suppliers. It’ll be incredibly interesting to see if this trend continues in the year ahead.”

IAB UK chief executive Jon Mew claims the figures are “testament to the resilience” of the industry, but added: “We shouldn’t lose sight of the fact that 2021 still wasn’t a normal year. We spent half of it in some form of lockdown – bringing with it an increased reliance on digital channels – while the return of large-scale events such as the Olympics and Paralympics in H2 will also have impacted spend.

“Ultimately, while growth on this scale is truly brilliant to see, what matters most is how we sustain investment in the long term, beyond recovery and in the face of growing regulatory scrutiny. As an industry, we should take confidence from the results announced today and channel that into pulling together to ensure a sustainable future for digital advertising.”

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