The UK is still on course to achieve the fastest advertising recovery of any major European market this year – and the largest rise on record – with spend being upgraded once more and forecast to grow 24.8% to reach £29.3bn – smashing July’s projection by 6.6%.
That is according to the latest Advertising Association/WARC Expenditure Report which forecasts that the crucial Christmas advertising season will be a major contributing factor, driving total investment for Q4 2021 to £7.9bn, again the highest level ever recorded.
The latest dataset also includes revised projections for 2022, showing a 7.7% increase year-on-year to more than £31.5bn. In 2020, the UK market witnessed a £1.8bn decline to £25.3bn.
Media channels set for a significant recovery following the Covid-19 pandemic include cinema (+123.2%) and out-of-home (+27.7%) – both hit hard by successive lockdowns – while the growth in search, which includes ecommerce spend, is expected to continue its rise (+11.4%).
Actual figures show advertising spend rose 86.5% to reach £7.7bn in Q2 2021, underlining a strong recovery following the unprecedented disruption during the first wave of Covid-19 last year, when UK ad spend fell by 34.1% in Q2 2020 at the height of the nation’s first lockdown.
All media have seen a strong recovery in Q2 2021, led by sectors such as out-of-home (+276.8%), digital magazine brands (+155.5%) and direct mail (+104.0%) as the nation emerged from the third coronavirus lockdown.
While the half year figures show a slower recovery for newsbrands, their online ad revenues still saw a double-digit growth (+22.2% national digital and +28.0% regional digital).
Total investment is expected to be £7.9bn during Q4 2021, the highest level ever recorded during the Christmas period and almost £1bn more than last year (£929m). Search advertising is forecast to be one of the quickest growing media in Q4 2021, rising 15.3% to £2,715m, buoyed by consumers’ online shopping habits.
In addition, TV advertising spend is set to see its largest Q4 increase in over a decade, expected to rise by 9.0% to £1.56bn, with broadcaster video-on-demand up by a quarter (24.1%).
Advertising Association chief executive Stephen Woodford commented: “UK advertising’s recovery goes from strength-to-strength, following the sharp shock of the pandemic. The forecast of strong online performance is further evidence of the UK’s position as the world’s most digitally advanced advertising market and Europe’s biggest.”
WARC head of data content James McDonald added: “The latest data demonstrate bullish trade in the UK’s advertising sector despite potential inflationary headwinds and supply chain disruption in the run up to Christmas. Strong fourth quarter projections for TV and search suggest it will be largely business as usual for the industry this year.”
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