GroupM: UK advertising will grow 4.8% to £19.8 billion in 2018

Despite the economic uncertainty of Brexit and the varying state of retail sales, UK advertising looks set to enjoy its ninth successive year of growth in 2018.

According to GroupM, the world’s largest investment group, the UK will remain one of the fastest-growing media markets in the world with a 4.8% growth. This will take total investment to $19.8 billion.

This is an upgrade from the group’s previous prediction, six months ago, of 4.5%.

GroupM also believes that 2017 will close with better then expected investment of $18.9 billion, which is growth of 5%.

2018 will see the internet taking an ever-larger share of UK ad investment, with GroupM estimating that ‘pure play’ internet will hold a 60% share. The factors at play here will be rising digital audiences and continued ecommerce growth, as well as performance-focused marketer short-termism.

“Advertising investment remains stable despite a fragile economy”, said Adam Smith, GroupM’s Futures Director.

“The focus of marketers remains relentlessly short-term and arguably underweighted relative to long-term brand building in broadcast media. This favours performance-oriented digital media which continue to be the most robust growth story despite concerns over measurement, transparency, brand safety and other issues”.

Stable market

"The latest Group M figures show brand marketers are embracing audio/visual formats more than ever to deliver engaging brand narratives,” David Barker, Managing Director & SVP, Amobee EMEA comments.

“Ad spend is a good measure of success, but what we as an industry should celebrate even more is how that success is driven and by what. The positive development we're seeing in market is growing sophistication in how brand marketers are using data-driven strategies to produce better quality ads and more accurate placement. Data and insights are massively contributing to return on investment in digital advertising and positively enhancing the impact of marketing campaigns and experiences for audiences."

While some advertisers halted their investment in YouTube due to concerns over brand safety. GroupM now estimates that two-thirds of these advertisers have now returned to their previous levels of investment.

Another issue that is going to define the year of advertising in 2018 is the onset of GDPR in May, which could make marketers more cautious in the face of new data compliance rules.

GroupM also estimates that legacy media and its associated digital components will continue to see their ad investment shrink 4.4% in 2017 and a further 2% in 2018.

“Our forecast shows a stable market in an overall low-growth consumer spending environment. This is encouraging, but we are concerned about pressures on marketers to overweight short-term ROI versus brand building for the long-term. It’s imperative they get the balance right”, said Nick Theakstone, CEO, GroupM UK.

“It’s also crucial that the industry deliver better audience measurement to support media planning for performance and brand building alike.”

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