The latest flagship AA/WARC Expenditure Report makes pretty grim reading, now the two are expecting just 2.6% growth in 2023 to reach £35.7bn after UK adspend registered a flat £9bn in the first three months of 2023.
The full year forecast is a slight increase on the previous one (2.1%) but still strongly suggests a struggling ad market for the rest of the year. Four per cent growth is forecast for 2024 to reach £37.1bn.
Grim for anyone but the digital giants anyway with internet expected to reach 76.7% of all spend this year and 77.6%, up from 75.1% in 2022. Search, which some might query as “advertising,” is growing fastest.
Aside from conventional digital, the only bright spots are broadcaster video-on-demand (BVOD) up 18.7% during the first quarter, online radio with growth of 7.6% and digital out of home (DOOH) up 6.8% in Q1.
Advertising Association CEO Stephen Woodford says: “This latest forecast indicates a slight improvement in outlook in terms of growth of spend, with the improvements in online forecasts being notable. However, with high inflation continuing to depress consumer and business confidence we may end up seeing a real-terms contraction of nearly 4.3% in 2023 for UK advertising investment.
“The recent higher-than-expected fall in inflation will hopefully continue and with that we will see confidence begin to build later in the year and into 2024, when the ad market is expected to return to growth.”