UK ad spend reached £10 billion during Q2 2024, according to the latest Expenditure Report from the Advertising Association (AA) and WARC. This marks a 13.4 percent increase on Q2 2023, when the market narrowly avoided contraction. While benefitting from these favourable comparisons, the latest quarter also recorded stronger-than-expected digital growth, alongside strong TV contribution driven by the Men’s Euros.
Ad spend on TV climbed 9 percent YoY during the quarter, according to the report, representing the channel’s strongest quarter in over two years. Unsurprisingly it was online formats that registered the highest growth in Q2, led by online display (21.6 percent), search (12.7 percent) and out of home (17.0 percent). But there was also good news for regional newsbrands (1.9 percent) and magazine brands (0.5 percent), which entered growth territory for the first time since the “pandemic bounce back” of Q2 2022.
However, combined with YoY declines in Q1, regional newsbrands and magazine brands remained in negative territory for H1 as a whole. But TV was up 5 percent in the first six months of the year, 16.8 percent of which came from BVOD. By way of contrast, Q2 2023 saw 10.2 percent of TV’s growth come from BVOD, suggesting the channel is growing its contribution to ad spend. Overall, total UK ad spend reached £19.6 billion in H1 2024, marking a 13.5 percent YoY increase.
Keeping pace
The report also forecasts full-year ad spend for 2024, which AA/WARC now expects to cross the £40 billion barrier for the first time. The £40.5 billion forecast represents 10.6 percent growth on 2023, driven by online display (18.8 percent), out of home (12 percent) and search (11 percent). The report notes that UK ad spend is on track to outpace key European markets this year, including France (8.0 percent), Spain (5.7 percent), Italy (5.4 percent) and Germany (4 percent).
Looking ahead to 2025, the study forecasts UK ad spend to reach £43.1 billion next year (up 6.5 percent YoY), due to more favourable trading conditions and higher consumer spending. Digital growth is projected to continue, while ad spend on TV is expected to decline 0.2 percent YoY, facing tough comparisons to a year boosted by sport.
“The advertising industry is once again driving UK growth, helping businesses to compete, promote innovation and support jobs,” said AA CEO Stephen Woodford. “It is an essential engine of the economy and key to the Government’s central ambition to achieve the highest sustained growth in the G7. Advertising has a vital role in funding culture, media and sport – and the results of Q2 show how advertising can play a fundamental part in supporting the success of events such as the Men’s Euros, the Olympics and the Paralympics.”
“Four in every five pounds spent on advertising so far this year has gone towards digital formats, money which has mostly been committed programmatically and which is increasingly leveraging AI tools for further efficiencies,” added James McDonald, Director of Data, Intelligence & Forecasting at WARC. “The strong growth across the online sector in particular during the first half of 2024 has put the UK’s ad market on course for its best year since the millennium, if the post-pandemic recovery year of 2021 is discounted.”