Ad market defies gloom with growth in 2010
The Advertising Association says the UK advertising market has "brushed off fears about the health of the economy" after growing in expenditure by 6.9% to £15.5bn in 2010.
That's according to the new Advertising Association/Warc Expenditure Report, published today, which claims the rise made 2010 the strongest year for adspend growth since the dotcom boom of 2000.
The performance was partly due to a higher than expected adspend increase in the fourth quarter of 2010. During the final three months of the year adspend increased by 5.8 percent.
Television (+12%) and direct mail (+12.7%) were the strongest performing media.
The report predicts that growth is expected to dip to 2.9% this year before bouncing back to 5.5% in 2012. Adspend growth "with also suffer in year on year comparisons to its strong performance in 2010".
It puts the modest prediction for this year down to "a relatively weak economy and failing consumer confidence".
However, the ad industry is expected to enjoy a revival in 2012, according to the report, due to the increased spending the London Olympics will bring.
Tim Lefroy, chief executive of the Advertising Association, said: “These are good news figures, not just for the advertising sector itself, but for UK business more widely. Rising ad spend reflects investment in sales by business, growth in media and content and, ultimately, signals a competitive, healthy UK economy."
Suzy Young, data editor at Warc, added: “2010 was an impressive year for UK adspend. This included a surprisingly strong performance from direct mail in the second half of the year. This could be attributed to advertisers relying more heavily on the more traditional and immediate forms of communication with the consumers."
Across 2010 as a whole, TV was the fastest-growing medium, with an overall increasing of 15.8% - its strongest growth rate since 1986.
This represents an improvement on 2009 which saw television adspend fall by 10.1%. It is expected to continue to grow in early 2011 with advertisers tapping into the short-lived mood generated by the public holidays and the Royal Wedding.
Out-of-home advertising also performed well in 2010, rising 12.5%, and internet is expected to have maintained its steady growth with a 10.9% increase for the year.
But results for press were mixed – national newspapers increased spend by 6% in 2010, but regional papers and magazines fared less well, dropping 6.4% and 5.9% respectively.