The latest Advertising Association/WARC Expenditure Report has outlined an even greater recovery for the UK’s advertising market than previously expected, with revised estimates for growth in 2021 standing at 26.4% to reach a total of £29.7bn.
The new findings upgrade October’s projection for 2021 (+24.8%) by 1.6 percentage points, equating to the strongest year in UK ad market history. This is supported by the actual data released for Q3 2021, showing adspend of £7.3bn – the largest-ever summer spend on record.
New forecasts also show total investment for 2022 is set to rise by 8.5% to £32.2bn – meaning the UK market will have expanded by more than a third since 2020. A bright start to the year contributes to an upgrade of almost one percentage point for 2022 growth, while sectors especially hit by the Covid-19 pandemic – such as cinema and out-of-home – will expect to see a continued recovery
Looking at the predictions for out-of-home (OOH) Matthew Dearden, CEO of Alight Media, commented:
"OOH was one of the hardest hit media by the pandemic, but these figures show that the industry has not only survived but thrived. People are back, so advertisers are back, and OOH is back. As an industry we’ve collaborated more than ever before, and this growth is not only possible but sustainable through our significant investment in infrastructure and technology. This has resulted in more flexible campaigns with even smarter data-driven planning.
At Alight Media we’ve become the fastest-growing OOH media owner during this period, moving from a new start-up to top five OOH media owner through rapid expansion. In 2022 we will see further significant growth in site numbers, campaigns and our talented team to enable us to achieve our goal – helping advertisers reach people in under-served areas with the highest quality sites and screens.
As our ‘digital first’ approach to OOH evolves, the medium will also develop by offering greater transparency, flexibility, creativity and efficiency for advertisers. This in turn will drive impact, improve marketing return-on-investment (ROI) and further growth in OOH spend."
Best-ever summer confirmed in 2021
Actual figures released by AA/WARC confirm adspend rose 23.2% during Q3 2021 to a record £7.3bn – three percentage points and £183m ahead of forecast. All media recorded double-digit growth in Q3 2021 following the previous year’s decline, as the summer period saw the return of key sporting moments such as the Euros, Olympics and Paralympics along with the easing of Covid-19 restrictions.
Triple-digit growth was confirmed for cinema (+655.9%) to £20.2m, marked by the September release of James Bond’s No Time to Die, while out-of-home saw an increase of 62.6% to £270.4m. Regional news brands saw online ad revenue overtake print for the second quarter running, as online revenue grew to £67.5m (+55.7%) with combined investment of £132.7m (+22.4%).
2022 market will have grown by more than a third since 2020
UK adspend is expected to continue to rise to £32.2bn this year as current projections anticipate 8.5% growth, including strong recoveries for cinema (+201.1%) and out-of-home (+26.8%). Continued growth is also expected from the largest advertising channels, including search (+11.1%), online display (+8.3%) and TV (+5.3%) as consumer habits gained during the pandemic are expected to be retained.
The latest figures suggest Q1 2022 also looks to be stronger than expected (particularly within TV) and overall adspend is now forecast to grow 12.6% year-on-year, compared with 10.5% previously.
Stephen Woodford, Chief Executive, Advertising Association said:
“UK advertising has seen a remarkable recovery from the coronavirus pandemic, racing ahead of key international markets with spend expected to cross the threshold of £30bn this year. A strong advertising market is a key indicator of the UK economy’s growth, with every £1 spent on advertising generating £6 GDP. The latest AA/WARC report brings welcome news not just for our industry but for the wider economy, as advertising investment is a key lever for businesses to capture new markets and drive their recovery.
“It is all the more important therefore that the Government recognises the need to support industry-led skills training to complement the demand for digital skills required to keep this market booming.”
| Media | Q3 2021 year-on-year % change |
9M 2021 year-on-year % change | 2021 forecast year-on-year % change | Percentage point (pp) change in 2021 forecast vs Oct | 2022 forecast year-on-year % change |
| Search | 18.7% | 36.7% | 31.0% | +0.9pp | 11.1% |
| Online display* | 20.5% | 32.8% | 26.9% | +1.5pp | 8.3% |
| TV | 28.9% | 30.6% | 26.1% | +3.2pp | 5.3% |
| of which VOD | 33.9% | 39.4% | 37.5% | +3.4pp | 13.7% |
| Online classified* | 36.8% | 31.6% | 25.8% | +1.2pp | 3.9% |
| Out of home | 62.6% | 14.2% | 25.4% | -2.2pp | 26.8% |
| of which digital | 68.7% | 24.8% | 35.7% | -2.4pp | 35.4% |
| Direct mail | 23.4% | 21.0% | 17.1% | +6.8pp | -6.8% |
| National newsbrands | 25.4% | 11.7% | 10.9% | +3.3pp | 1.4% |
| of which online | 22.8% | 22.4% | 17.4% | +4.2pp | 6.4% |
| Radio | 30.7% | 28.9% | 21.7% | +4.0pp | 4.0% |
| of which online | 49.7% | 54.5% | 41.4% | +6.7pp | 10.7% |
| Magazine brands | 22.3% | 24.4% | 20.4% | -1.2pp | -3.0% |
| of which online | 41.0% | 62.2% | 45.9% | +4.0pp | -1.0% |
| Regional newsbrands | 22.4% | 7.8% | 7.8% | +0.4pp | -6.1% |
| of which online | 55.7% | 37.0% | 33.2% | +8.2pp | 0.9% |
| Cinema | 655.9% | -57.0% | 70.0% | -18.0pp | 201.1% |
| TOTAL AD SPEND | 23.2% | 30.8% | 26.4% | +1.6pp | 8.5% |
| Note: Broadcaster VOD, digital revenues for newsbrands, magazine brands, and radio station websites are also included within online display and classified totals, so care should be taken to avoid double counting. Online radio is display advertising on broadcasters’ websites. Source: AA/WARC Expenditure Report, January 2022 |
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The Advertising Association/WARC quarterly Expenditure Report is the definitive guide to advertising expenditure in the UK with data and forecasts for different media going back to 1982.