The report, This Year, Next Year: UK Media and Marketing Forecasts said measured ad spending in the UK is expected to reach a total of £15.9 billion ($24.8 billion) in 2015, up from £14.9 billion ($23.3 billion) in 2014.
The study, released by GroupM futures director Adam Smith, also predicted that UK ad spending in 2016 would increase 4.8 per cent to £16.6 billion ($25.9 billion).
According to the report, “Advertisers lack pricing power in a deflationary world. The focus on marketing cost and performance will remain, but there is no limit on innovation or differentiation. UK media investment demonstrates this. The largest contributor to growth is online display, the most innovative part of UK advertising today, in execution, formats and data.”
Digital spending will reach £8.0 billion ($12.5 billion) in 2015 and is expected to reach £8.7 billion ($13.6 billion) in 2016, indicating average annual growth of 10 percent. “The familiar drivers remain video, social and mobile, in which advertiser confidence is bolstered by data improving in quality and application, and by the many benefits of automation,” said Smith.
Press media remain under the most pressure, with 2015 advertising in physical newspapers and magazines expected to fall 9 per cent from 2014 and a further 10 per cent fall in 2016 to £2.1 billion ($3.3 billion). However, Smith adds “Demand for digital news brand inventory is good. Adding back digital gains improves the sector’s trajectory 3 or 4 points. Publishers are making a sustained, unified effort to improve this with new focus on advertiser needs.”
This Year, Next Year is part of GroupM’s media and marketing forecasting series drawn from data supplied by holding company WPP’s worldwide resources in advertising, public relations, market research, and specialist communications. Copies of the full report are available from GroupM Publications.