In the ever-evolving landscape of the UK advertising market, the most recent Advertising Association/Warc Expenditure Report has brought good news. The report indicates that the advertising market in the United Kingdom showed resilience by experiencing a modest increase of 1.0% during the second quarter of 2023. This growth, in line with AA/Warc’s July forecast of 0.9%, has pushed the total market value close to a substantial £9 billion.

The advertising industry has long served as a barometer for the overall health of the UK economy, and the latest findings from AA/Warc continue to reinforce this correlation. The 1.0% ad spend growth in Q2 closely outpaces the 0.6% GDP increase reported by the Office for National Statistics (ONS) for the same period. This alignment between advertising and broader economic indicators is a testament to the industry’s predictive power.

In the first half of 2023, the UK advertising market recorded a 1.0% year-on-year increase, amounting to £17.5 billion in ad spend from January to June. This represents a notable uptick from the previous year’s £17.3 billion.

Looking forward to the full-year forecasts, AA/Warc anticipates that ad spend will expand by 2.6%, reaching an impressive £35.6 billion in 2023. Some of the standout performers are expected to be Broadcaster Video on Demand (BVOD), with a projected year-on-year growth of 16.1%. Additionally, online display (7.4%), out of home (7.7%), and cinema (7.6%) are all poised for growth. The anticipation of significant sporting events like the FIFA Women’s World Cup and the Rugby World Cup, along with key content moments such as the return of Big Brother to ITV and the success of the Barbie and Oppenheimer films, is expected to boost ad spend in the latter half of 2023 despite ongoing economic challenges.

The latest dataset reveals that the UK’s advertising market is on track to grow by 3.9% in 2024, reaching a total of £37.0 billion. This represents a slight downgrade from the July forecast of +4.0%. While more channels are expected to return to growth next year, such as online segments of national and regional newsbrands and magazines, the economic backdrop is likely to remain challenging.

Quotes from Industry Leaders:

– Stephen Woodford, CEO of the Advertising Association, emphasized the industry’s role as an economic indicator, stating, “Advertising continues to show itself as a weathervane for the UK economy, with the advertising market expected to grow slightly more than the economy, with both barely in positive figures. Looking ahead to 2024, we expect to see more channels experience growth again, as the ad market grows to £37 billion for the year.”

– James McDonald, Director of Data, Intelligence & Forecasting at Warc, acknowledged the economic challenges but expressed encouragement, saying, “It is therefore encouraging that, amid this backdrop, the UK’s advertising industry was able to grow during the first six months of 2023, and that the market is on course to be 2.6% larger this year overall. It should, however, be noted that this growth is concentrated in certain corners of the industry, with broadcasters and publishers bearing the brunt of an unfavorable trading climate while digitally native platforms largely prosper.”

In the midst of economic uncertainty, the UK advertising market seems to be not only surviving but thriving, demonstrating its capacity to adapt and evolve in changing times.