Total video ad revenues in the UK grew by 33 percent in 2018 according to the Internet Advertising Bureau (IAB), reaching £2.3 billion, and helping total UK digital ad revenues reach £13.44 billion overall. This is largely driven by growing spending on smartphones – 76 percent of all video spend is on smartphones according to the IAB, and almost all of last year’s digital ad spend growth came from mobile advertising.
The data comes from IAB UK and PwC’s latest Digital Adspend Study released today, which draws on reported ad revenue figures from a number of digital publishers, bolstered by modelling of UK ad spend figures for companies which don’t explicitly provide them, the likes of Google, Facebook, Twitter and Snap.
The study found that video accounted for the majority of growth in ‘display’ – the IAB uses the term ‘display’ as a catch all term for ads which aren’t search ads or classifieds, including video ads, banner ads, native ads and sponsored content. Video remains the largest component of this display category, accounting for 44 percent of all display revenues, up from 40 percent last year. This gives video a substantial lead over banner ads which bought in £1.48 billion last year, compared to video advertising’s £2.3 billion.
Outstream, which overtook pre, mid and post-roll as the largest video format last year, extended its lead in 2018. Outstream (which includes social in-feed under the IAB’s definition) now accounts for 57 percent of all video ad revenues in the UK, or £1.3 billion. Pre, mid and post-roll formats meanwhile collectively made up 42 percent of all video ad revenues, with other video formats making up the final two percent.
Overall, digital ad spend in the UK continues to grow at an impressive rate, with 2018’s revenues of £13.4 billion marking fifteen percent growth year-on-year. As mentioned above, advertising on smartphones was the primary driver – while total digital ad revenues grew by £1.76 billion, smartphone ad revenues alone grew by £1.65 billion. This means that smartphone revenues now, for the first time, account for the majority of digital ad revenues in the UK, making up 51 percent of total digital ad spend.
IAB UK’s chief digital officer Tim Elkington described this as “a significant milestone”. “In a decade of reporting these figures separately, we’ve seen spend rise from £38m in 2009 to a staggering £6.88bn in 2018,” he said.
IAB UK’s CEO Jon Mew meanwhile said that not only is digital ad spend continuing to grow impressively, but perceptions around digital advertising are starting to change as well. “We continue to see evidence of online advertising being used for brand-building, especially by the growing market of direct to consumer (DTC) brands,” he said. A separate study conducted by YouGov and commissioned by the IAB found that over half of marketers now use digital advertising for longer-term brand building, not just short-term sales activation.
