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Digital Ad Spend Sentiment Inflation

IAB UK: digital ad spend boomed 41% in 2021


By John Glenday, Reporter

April 26, 2022 | 3 min read

UK digital ad spend surged 41% in 2021 to hit a record high of £23.5bn.


Digital ad spend boom delivers breakneck growth of 41% in 2021

The impressive statistics are conveyed by IAB UK in its latest adspend report, which now more truly reflects the reality on the ground by including shoppable search spending for the first time.

The bullish report, compiled with PwC, represents the greatest full-year growth rate for 15 years and amounts to a 50% hike on pre-pandemic spending, with expenditure up 33% across the board when excluding the outsize influence of the five largest firms operating in the sector.

Making up for lost ground following only moderate 5% growth in 2020, when connected TV (CTV) was the main driver, recent increases have been powered by surging confidence among advertisers and buoyed by a rampant search sector, which jumped 38% to £11.7bn – £3.5bn of which is attributed to shoppable search as e-commerce comes to rule the retail roost.

Jon Mew, chief executive officer of IAB UK, said: “It’s particularly exciting to see emerging formats such as in-game advertising and podcasts continue to gather pace and offer new, untapped opportunities for growth.

“However, we shouldn’t lose sight of the fact that 2021 still wasn’t a normal year. We spent half of it in some form of lockdown – bringing with it an increased reliance on digital channels – while the return of large-scale events such as the Olympics and Paralympics in half two will also have impacted spend.”

Growth proved strong across the board, with display ads surging 53% to £9.7bn as both social and non-social display categories broke the 50% barrier. This was driven in large part by video, which grew 58% to reach £5.5bn. Mobile continues to account for the lion’s share (60%) of spend, a further 43% year-on-year rise which leaves it sitting pretty on £14.13bn.

As Mew mentioned, newer formats such as podcasts and gaming have also performed strongly – even if they remain low in absolute terms – with podcast investment up 61% to £54m, while its digital audio stablemate came from nowhere in 2020 (up 17%) to post a startling 58% rise in 2021.

Meanwhile, ad spend on static and in-game advertising reached £9.8m as advertisers scramble to reach this highly-engaged audience.

Digital Ad Spend Sentiment Inflation

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