Advertising forecast for 2023 downgraded
The UK’s ad market is expected to grow by 3.8 % this year, on par with the previous forecast but a 3.0% real terms decline with inflation accounted for and down from an estimated 8.8% rise in 2022, advertising and marketing firm WARC says in a report. For the first nine months of 2024, WARC predicts growth of 5%.
UK advertising spend rose by 4.3% to a total of £8.5bn between July and September 2022, the ninth consecutive quarter of growth and demonstrative of an ongoing, resilient recovery from the COVID-19 pandemic.
WARC says forecasts for the coming year show reduced growth expectations for almost all sectors of advertising in line with pressures felt by all parts of the economy.
For the first nine months of 2022, growth was up by 10.8%, with a total of GBP 25.3 billion.
Out of Home (OOH) and cinema, specifically, continued their strong recovery during Q3, while search rose 7.7% – equating to almost 40% of total adspend during the quarter, WARC says.
Social media, included within online display, continued growing (+4.4%), while broadcast video on-demand (BVOD) spend rose by 4.3%.
The economic pressures of 2022 including high inflation’s impacts on the wider economy and on media costs means in real terms spend is likely to be flat. These pressures all contribute to slower growth projections for the year ahead”, says Stephen Woodford, Chief Executive, Advertising Association
“Despite an air of resilience in recent market results, a looming recession will put pressure on ad trade this year. We foresee ad market growth easing to 3.8%, equating to a real terms decline and the weakest rise in a decade if the pandemic-hit 2020 were excluded”, says James McDonald, Director of Data, Intelligence & Forecasting, WARC
“The silver lining here is that our current modelling suggests that the slump will be short lived, with advertising investment set to lift by 5% over the first nine months of 2024.“
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