UK TV advertising slips back year-on-year

Even though it did not quite hit the highs set two years ago, nor indeed 12 months earlier, the UK’s advertising market generated £5.11 billion in revenue in 2017, according to survey data from Thinkbox.

The association of UK commercial broadcasters said the figures represent all money invested by advertisers in commercial TV across all formats and on any screen: linear spot and sponsorship, product placement, broadcaster VOD, addressable and interactive.

The data showed that the annual decrease compared with 2016 came after seven consecutive years of growth in the UK, caused mainly by ongoing economic and political uncertainty, with a weakened pound and inflationary pressure leading some advertisers to reduce TV investment, notably FMCG advertisers. Yet according to data from Nielsen, FMCG spend on TV advertising in Q4 2017 grew by 8% compared with the same period in 2016. And figures from the UK broadcasters suggest that Q4 2017 saw an approximate 2% overall increase in TV spend year-on-year. The Advertising Association/WARC predicts that TV advertising in the UK will return to annual growth again in 2018, forecasting a 1.5% increase in total investment.

Thinkbox also found that, according to Nielsen data the top five TV spending categories in 2017 were: online businesses: £682 million (0.3% down year-on-year); food, which generated £559 million (-11.4%); cosmetics and personal care with £431 million (-2.4%); entertainment and leisure generating £385 million (+1.6%); and finance, capturing £324 million (-3.1%).

Commenting on the results, Lindsey Clay, chief executive of Thinkbox, said: “Post-recession, TV advertising in the UK had seven consecutive years of growth. But TV hyper-reacts to the economy, good or bad, and recent uncertainty saw growth stall in 2017. That growth is now returning. The pendulum is swinging back to TV. We have more proof than ever that TV advertising drives business growth and outperforms all other forms of advertising. TV is a proven, trusted, high quality environment for brands. And TV’s strengths and unique assets have been thrown into even sharper relief recently following the much-publicised scandals and loss of trust in some areas of online advertising. Advertisers are re-assessing where they advertise and TV is well placed to capitalise.”

£5.27 Billion Invested in U.K. TV Advertising in 2016

Television ad revenue in the U.K. totaled £5.27 billion ($6.6 billion) in 2016, with online businesses now the biggest spenders on TV, according to full-year revenue figures provided to Thinkbox by the British commercial broadcasters.

According to Nielsen, among the biggest spending online businesses on TV were Amazon (£34.3 million, up 39 percent), Comparethemarket.com owner BGL Group (£38.8 million, down 4 percent) and Moneysupermarket (£25.9 million, up 6 percent).

Together, new or returning advertisers accounted for 1.6 percent of total TV ad revenue in 2016, according to Nielsen. WARC estimates for the Advertising Association indicate that the total U.K. advertising market grew to £21.1 billion in 2016 (up 4.4 percent), with TV advertising representing 25.3 percent of it. The AA/WARC forecast that in 2017 the U.K. ad market will reach £21.8 billion (up 3.2 percent), with TV forecast to increase by 1.6 percent.

Despite some recent inflation in TV advertising prices—due in part to increased advertiser demand and some decline in TV set viewing—in 2016 TV advertising was 28 percent cheaper in real terms than ten years ago.

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http://worldscreen.com/tveurope/2017/02/23/thinkbox-5-27-billion-invested-in-u-k-tv-advertising-in-2016/