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Press Release

UK advertising spend sees growth as economy stalls

13 December 2011

Advertising spend in the UK grew by 1.5% in Q3 2011 to £3.8bn, with a similar rate of growth expected in Q4 (+1.3%) according to new figures from AA/Warc. Cinema (+18.8%) and radio (+13.4%) recorded strong increases but these were offset by sharp downturns for print. Popular national Sundays (-28.4%) and popular supplements (-30.6%), witnessed the biggest decline in adspend due to the closure of News of the World.

Predicted growth for total UK adspend in 2011 remains unchanged from October at +1.6%, or £15.9bn. However, expected growth in 2012 has been downgraded from +4.7% to +3.8% (£16.5bn). This reflects the deteriorating economic outlook and the impact of the Eurozone crisis on global corporate and consumer confidence.

If inflation is accounted for, adspend is predicted to decline by -2.9% in 2011, with a marginal +0.7% rise predicted for 2012. Moreover, the impact of the credit crunch and economic downturn is such that the total amount invested in UK adspend throughout the forecast period is only expected to be on a par with levels recorded in the late 1990s.

The AA/Warc Expenditure Report provides the most comprehensive measure of UK advertising activity. It includes a detailed view of actual spend by individual media encompassing print, TV, digital, cinema and out-of-home, as well as forecast data for the coming 24 months.

Tim Lefroy, Chief Executive at the Advertising Association, said: “Adspend is showing steady growth in the second half of 2011 and this looks set to continue through 2012, despite the gloomy economic outlook.”

Suzy Young, Data Editor at Warc, added: “The London Olympics and the Euro 2012 football tournament should provide a boost to UK adspend in the summer months, but there is a possibility that this could come at the expense of the first quarter.”



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