The UK advertising landscape is experiencing a remarkable resurgence, with ad spending reaching nearly £20 billion (£19.6 billion) during the first half of 2024. This surge is highlighted in the latest Advertising Association (AA) and WARC Expenditure Report, which reveals that the advertising market recorded a significant £10 billion spend in the second quarter alone—a 13.4% year-on-year increase. This growth has exceeded expectations and signals a brighter future for the industry.

A Positive Shift in Ad Spend

The AA and WARC report indicates that the robust growth in Q2 2024 is primarily driven by stronger-than-expected digital results and a relatively weak market performance in 2023. Overall, ad spending has grown by 13.5% year-on-year in the first half of 2024, surpassing forecasts by more than four percentage points. The strong showing across various digital formats has played a crucial role in this uplift, with notable growth in online display (21.6%), out-of-home (17%), and search (12.7%).
Moreover, the upcoming Euro 2024 finals in Germany have been identified as a key factor influencing the advertising sector. They contributed to a 9% growth in TV ad spend, marking the medium’s strongest quarter in over two years. This resurgence highlights the vital role that events like the Men’s Euros play in stimulating advertising activities.

Encouraging Signs Across All Media

The report also indicates that regional news brands and magazines have finally experienced growth, with an increase of 1.9% and 0.5%, respectively. This is particularly significant as it marks the first growth for these sectors since the post-pandemic bounce back in Q2 2022.
Stephen Woodford, CEO of the Advertising Association, emphasised the importance of advertising in driving UK growth: “The advertising industry is once again driving UK growth, helping businesses to compete, promote innovation, and support jobs. It is an essential engine of the economy and key to the Government’s ambition to achieve the highest sustained growth in the G7.”

Upgraded Forecasts for 2024 and Beyond

In light of these positive developments, the AA and WARC have upgraded their forecasts for 2024, anticipating a growth of 2.9 percentage points and projecting that ad spending will surpass £40 billion (£43.1 billion) for the first time, representing a year-on-year increase of 6.5%. This optimism is also reflected in the projected real terms growth for 2024, which is expected to be 7.9%. The UK’s advertising growth is poised to outpace key European markets, including France (8.0%), Spain (5.7%), Italy (5.4%), and Germany (4.0%).

James McDonald, WARC’s Director of Data, Intelligence & Forecasting, noted, “four in every five pounds spent on advertising so far this year has gone towards digital formats, mostly committed programmatically and leveraging AI tools for further efficiencies.”

The growth across the online sector, particularly in the first half of 2024, positions the UK ad market for its best performance since the turn of the millennium.

The State of US Ad Spending

Across the Atlantic, the US advertising market is also on an upward trajectory. 10.1% year-over-year increase in ad spending for September, marking the third consecutive month of double-digit growth. This growth has been fueled by advertising efforts tied to the Paris Olympic Games coverage in July and August.

Looking Ahead

As the advertising industry continues demonstrating resilience and adaptability, stakeholders are optimistic about the future. The latest figures reveal a dynamic and evolving UK advertising market that is recovering and thriving, setting the stage for a promising future as it adapts to changing consumer behaviours and technological advancements. With a focus on digital growth and a commitment to innovative advertising strategies, the industry is well-equipped to navigate the challenges ahead and capitalise on emerging opportunities.

Source: Advertising Association website.