UK TV Ad Revenues Fell Two Percent in 2017 says WARC/AA

Ad revenues for TV in the UK shrunk by two percent in 2017, the first annual dip since 2009 according to estimates from WARC and the Advertising Association (AA). However the Advertising Association/WARC Expenditure Report’s results for the UK ad industry as a whole were positive, showing 3.5 percent year-on-year growth in Q3 driven by the strong performance of mobile advertising.

The WARC/AA data found TV spend in Q3 of 2017 declined by 0.8 percent compared to 2016. While initial data shows that TV spend across digital and traditional formats returned to growth in Q4, they believe the increase will not have been enough to avoid an overall decline for the year, predicting TV ad spend to have shrunk 2.0 percent.

TV revenues are expected to return to growth this year though, thanks largely to increased spending on digital TV formats. UK video on demand (VOD) ad spend grew 13.3 percent in Q3 compared to the previous year, and WARC/AA expects total TV ad revenues to grow 1.5 percent this year as VOD spending continues to climb.

While TV struggled last year, the outlook for the UK ad market as a whole was positive, as it recorded its 17th consecutive quarter of market growth. The report attributed these results in large part to mobile, which grew 30.7 percent year-on-year in Q3 to £1.3 billion.

Total mobile ad revenue actually surpassed total TV ad revenue for the first time in Q3, though the report says TV still bought in significantly higher display revenues (display includes video under WARC/AA’s definition). Mobile’s growth has been largely thanks to investment in mobile search and social channels, according to WARC’s data editor James McDonald.

Mobile spending on social channels specifically saw a 44.7 percent year-on-year increase in Q3, and this coupled with rising mobile spending on paid search leads WARC/AA to estimate that 2017’s total mobile ad spend to exceeded £5 billion.

Stephen Woodford, CEO of the Advertising Association, hailed the results as encouraging, and said they demonstrate the ad industry’s importance to the UK economy. However he also emphasised the potential significance of Brexit, saying the industry needs to help the government negotiate a deal which will support UK advertising.

“As we work through Brexit, we need to help Government make the best decisions to support our industry and, by extension, the wider UK economy as we target growth across the nations and regions and in an increasingly global marketplace,” said Woodford.

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