Direct mail is predicted to record its second highest growth rate in eight years during 2018, beaten only by last year’s figures, despite Royal Mail’s fears that GDPR will put the kibosh on mail volumes.
According to the latest GroupM predictions, direct mail will witness modest growth – +0.7%, compared with +0.9% in 2017 – but it will be worth more, £1.5bn compared to £1.49bn last year.
These figures do not take into account unaddressed mail, door drops and leaflets, meaning spend will be well over the £2bn-mark yet again, reinforcing the view that there is still plenty of life in the old dog yet.
Overall, UK advertising is expected to increase to £19.9bn in 2018, up from £18.8bn last year, and GroupM predicts investment will surpass £20bn for the first time in 2019.
GroupM forecasts 6.1% growth for 2018, down from 6.4% in 2017, and its first growth prediction for the year ahead is 5.1%.
Pure-play Internet and surging growth by Facebook particularly are the primary drivers for all advertising growth. Pure-play Internet has expanded its share of investment every year since 2000. It was 1% of measured advertising then and will reach 59% in 2018, 61% in 2019, GroupM insists.
Outdoor advertising investment is stable, but its digital ‘software’ (automation, validation, optimisation) needs to catch-up with its impressive ‘hardware’ (digital screens) to fulfil its potentia the report claims.
GroupM futures director Adam Smith said: “UK advertising investment is growing faster than the economy, defying Brexit chaos and bouts of consumer fatigue. One reason is colossal digitisation in media and in marketing practice, driving up competition, standards and innovation. Another is the scale of the tail.
“We must, however, beware of diseconomies of excessive specialism and short-termism. We need more technology but fewer technicians. Automation including AI must increase to liberate human brains for advertising strategy.”
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