Advertising worth £18bn to the UK media and entertainment industry

The advertising industry is worth a staggering £18bn in revenue to the UK media and entertainment industry, making it the second largest sector behind TV.

As a whole, the combined revenue of the UK’s top 100 media and entertainment companies is expected to surpass £100bn in the next five years, with Deliotte’s most recent Media Metrics claiming that the industry currently draws £87bn and over the last three years, has grown six per cent annually.

The top 100 lists companies from advertising, publishing, television, film production, music and video gaming but TV represents the largest sub-sector, accounting for 19 of the top 100 companies and generating a combined revenue of £35bn.

The 10 largest media and entertainment organisations in the UK account for more than two thirds (68 per cent) of the top 100’s total revenue, equating to £59bn.

Jodi Birkett, TMT partner at Deloitte in the North West, comments: “Our analysis has found the UK media sector to be in rude health. TV in particular is riding high despite digital entrants and uncertainties around public broadcasting in the UK.

“Physical products are currently the dominant source of revenue, but this is likely to change as consumers’ adoption of and appetite for digital content grows. Whilst a number of organisations have seen their investment in digital start to pay off, media executives need to ensure their business strategies can adapt to further digital disruption.

On the dangers faced by ad companies, Birkett concluded: “Some facets of the media industry, such as news publishing, fear diminishing revenues from ad-funded content. Whilst this impact has not yet shown through in the financial performance of the advertising sector, which has grown by eight per cent annually over the last three years, ad companies may need to consider multiple sources of revenue in order to attract business from the digital and social media giants that have emerged in the sector.”

Get The Drum Newsletter

Build your marketing knowledge by choosing from daily news bulletins or a weekly special.