The UK advertising market continues to be one of the powerhouses of the UK economy, recording a 6.4% year-on-year increase in spend in 2025 to £46.7bn with a further 6.6% rise on the cards this year to reach nearly £50bn.
So says the latest Advertising Association/WARC Expenditure Report, which also shows that £12.9bn was committed to media during last year’s Q4 festive season alone.
While UK GDP is estimated to have grown by 1.4% in 2025, double-digit growth was recorded across addressable TV (37.0%), social media (21.0%), retail media (17.5%) and online radio (14.9%) over the same period year.
Meanwhile, search (5.8%), cinema (3.4%) and out-of-home (2.3%) also saw an increase in year-on-year growth, while direct mail continued to hold its own (0.3%).
Search has continued to account for the biggest share of UK advertising investment at 38.3%, followed by social media (24.7%) and TV (11.2%).
Looking ahead, the report predicts a 6.6% increase in adspend to £49.8bn 2026, up nearly £2bn from the April 2025 prediction of 5.6% growth, driven by the Fifa World Cup and cinema releases including The Devil Wears Prada 2 and Toy Story 5. However, this figure is a slight downgrade from the rather optimistic 7.5% rise in January’s forecast.
The market is also expected to rise by 5.6% in 2027 to be worth £52.6bn.
And while these figures mask a much more nuanced reality, caused by macroeconomic factors, the market is still on track to effectively double in value in just six years, recovering from the £24bn nadir of the 2020 Covid-19 pandemic to reach £50bn this year.
Meanwhile, the report has undergone a major refresh following extensive collaboration with industry stakeholders to ensure advertising investment reflects the evolving media landscape.
This includes updated channel definitions, developed in consultation with stakeholders responsible for each channel, as well as a simplified reporting format, with retail media and social media now being presented publicly as standalone channels for the first time.
The result is a refined dataset for public use that reflects an even deeper understanding of the dynamic media marketplace in 2026.
The AA and WARC worked closely with representative industry bodies, including IAB UK, IPA, ISBA, Newsworks, Marketreach, Outsmart, the Cinema Advertising Association, PPA, Radiocentre and Thinkbox to redraw media definitions to reflect current trading practices.
A second phase will see a working group of stakeholders convened to address further areas for refinement, including developing a clearer understanding of investment in the influencer/creator channel and how to address investment in the emerging GenAI/LLM advertising channel.
There will also be work to increase understanding of how investment in media may differ between large brand advertisers and the long tail of SMEs, which together are estimated to comprise 3.5 million UK businesses alone that advertise each year in the UK, as well as many more from overseas.
Advertising Association chief executive Stephen Woodford said: “I would like to thank all our stakeholders for their feedback, collaboration and active participation in this process. This evolution of the AA/WARC Expenditure Report will ensure the industry has the best possible information to guide understanding of investment across the UK advertising and media landscape, reflecting how dynamic and diverse that landscape has become.”
WARC director of data, intelligence and forecasting James McDonald added: “The AA/WARC Expenditure Report has been a staple for practitioners for over four decades, and this latest iteration – developed in close consultation with industry stakeholders – ensures our investment benchmarks will continue to accurately reflect the pace of change in advertising trade for many years to come.
“The result is greater clarity and transparency around media investment in the UK, to the benefit of both the media industry and the public at large.”
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