UK advertising market buoyed by mobile boom

A boom in smartphone and mobile advertising has spurred growth in the UK advertising market as industry forecasters reckon ad revenues should soar 5.5 per cent this year and 6.5 per cent next year to reach a record £20bn.

The Advertising Association/Warc expenditure report shows an accelerating trend as it confirmed the UK ad market grew 3.9% last year or around £700m to £17.9bn. Revenues should rise £1bn to £18.9bn in 2014 and over £1.1bn in 2015, adding to optimism about the economic recovery.

Tim Lefroy, chief executive of the Advertising Association, which represents the ad industry, hailed “another set of positive indicators” about the UK, following similar surveys from media-buying agencies and the International Monetary Fund.

The AA report expects mobile advertising on phones and tablets to leap 73 per cent to £1.7bn this year, after doubling during 2013 to £1bn, and Mr Lefroy said that showed Britain was benefitting from its position as a world-leader in smartphone and high-speed broadband adoption.

“The forecast explosion in mobile advertising and digital formats points to UK advertising at the centre of a global revolution,” he said.

Total digital ad spend, including mobile, is forecast to climb 12 per cent to £7.1bn this year – or nearly two-fifths of the UK market.

Traditional media sectors are also performing well. TV is set to rise 6.6 per cent to £4.9bn as it is boosted by online video on demand.

National newspapers, or national newsbrands as some now describe themselves, are forecast to be flat at £1.5bn as digital growth offsets print decline. Last year, digital advertising for national newsbrands surged 19.5 per cent, according to the AA.

Sir Martin Sorrell, chief executive of WPP, the world’s biggest advertising group, has reported a 7% rise in worldwide revenues in the first quarter and pointed to the decision by several major advertisers including Vodafone and Marks & Spencer to sign new media-buying deals in the last month as a sign of increased activity.

“There’s a lot on the move,” he said, noting the delayed mega-merger of rivals Publicis and Omnicom was prompting clients to review deals.

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