In the latest Expenditure Report from the Advertising Association and WARC (AA/WARC), a total market growth of 6.3% ad spend was noted year-on-year to £23.6bn in 2018. In the final quarter of 2018, ad spend rose 5.7% year-on-year to £6.5bn.
However, growth was buoyed almost entirely by online-based formats such as paid search and social media, and printed media continued to slip.
Out of home (OOH) marked a 5.7% growth to £1.2bn, though this was attributed by AA/WARC almost exclusively to the “flexibility” of digital OOH options, which had been the case since 2013. However, an uptick of 0.4% in traditional OOH was noted for Q4 2018.
Traditional still reportedly accounts for half of the OOH at present at £606m, but the balance is predicted to shift in 2019.
WARC managing editor James McDonald said: “Brand budgets are not limitless, and while the AA/WARC data do not conclusively prove advertisers are moving money from offline to online formats, there has been a clear correlation since 2010.
“Ancillary research shows that cross-channel campaigns are better at delivering ROI, and that the digital components of these campaigns boost the effectiveness of traditional media. So, it follows that media mixes have become more varied as online channels have grown in prominence. However, the skew is now heavily towards digital formats.”
Ad spend with national newsbrands fell overall by 6.3% in 2018 to £970m, though when online newsbrand ad spend was taken in isolation, it declined by only 0.2%. Similarly, magazine brand-based expenditure fell by 7.5% to £717.7m, though online magazine brand spending fell by just 0.3% across 2018.
Direct mail saw declines across the year of 8.5% to £1.5bn, with further declines forecast of 8.2% then 7.3% across the next two years. McDonald said AA/WARC had found in consulting with industry stakeholders that GDPR continues to be the cause of the “sharp declines”.
He said a return to growth was “quite possible” for direct mail when the impact subsides.
“Print still has an important role to play in advertising and many of the country’s biggest brands, such as BT, Sky, Tesco and Vodafone, agree to some extent as they continue to invest in print formats,” he said. “Facebook’s biggest-ever ad campaign, ‘Here Together’, featured print ads alongside TV and cinema spots. This shows that when they really needed to get their message across, print played an important part in delivering that message.
“Print formats now seem to be occupying a more specialist place in the market, delivering unique and refined audiences as opposed to being a mass-reach format. That’s not to say print media cannot deliver large audiences, just this refinement is a natural conclusion of consumers spending more time online.
“But this should not be regarded as a negative; indeed, there are benefits – more engaged audiences, for example, and the credibility the title can add to an ad campaign.”