New research reveals Half of all UK ad spend now on Digital Media

Digital TV Advertising Media Channel

By Ian Young, Media Manager at The Agency

Recent research from eMarketer revealed that of the projected £16.2bn advertising spend in the UK this year, half will be on digital media. This is not just a first for the UK, but for any country in the world.

The fact that a large proportion of the UK media landscape is made up of the BBC means that much of our TV and radio is ad-free. This means that comparative spending on digital is higher. Having said that, it still demonstrates the rapid rise of digital ad spend over the last decade.

“Digital reaching the 50% threshold in the UK is a significant moment for the ad industry,” said Bill Fisher, analyst at eMarketer. “The UK ad market is notable for its aggressive embrace of online advertising.”

But where exactly is all this digital ad spend going and why is digital media being so well embraced in this country?

Perhaps unsurprisingly half of all digital ad spend is still going on search formats, with Google being the most prominent. The increased competition in natural search rankings and the changes Google has made, like encrypting organic traffic, has helped bolster search spend in the UK.

However, the real growth has come from mobile ad spend. With the advances in smartphone and tablet technology and the proliferation of Wi-fi and 4G connectivity, consumers are spending more and more time on their mobile devices. Print publishers have reacted to this shift by putting more emphasis on their digital proposition whilst advertisers are shifting ad-spend into mobile search and display to reach audiences. By the end of this year ad spend on mobile devices is expected to increase by 45% to £3.3bn.

The huge increase in mobile apps has also fuelled the sectors growth. It is predicted that app downloads in the UK will exceed £15 billion in the next three years, with some sources suggesting that up to 89% of time spent by consumers on mobile is via mobile apps.* Combined with the improvements in in-app ad formats, particularly video, it is easy to see why brands are entering the space.

What all of this says to me is that this is part of the continuing shift towards digital media as an awareness generation medium. Online will always be the a key transactional channel due to the huge search market, but through the growth of areas such as mobile advertising it will continue to be an increasingly important channel with which brands can reach their audience.