Report: UK online ad spend growth to slow this year
By Alisa Zykova, Thursday 25 September 2008 at 23:22 :: Advertising :: #2347 :: rss
Online advertising in the United Kingdom is expected to slow as a result of the global financial crisis and UK’s economic turmoil, the Guardian reported Thursday. While online ads are still expected to see stronger growth than those on television and in newspapers, their growth might decrease from 38 percent last year to 20 percent in 2008.
A PricewaterhouseCoopers (PWC) report shows that this slowdown may not be due to declining expenditure online, but is because advertisers intend to decrease their overall budgets.
The study also revealed that advertisers might drop display ads that strengthen numerous Web sites and instead concentrate on sections that gather more substantial results, such as Web searches. These are expected to increase by 10 percent to 15 percent, the Guardian reported.
“In a time of economic uncertainty, advertisers often take a more cautious approach,” the PwC report stated, according to the Guardian. “Consequently, there is an increasing focus on measurable return on investment of online campaigns, shifting some budgets from brand-building related towards direct response spend. This trend is benefiting search.”
In Europe, Internet ad expenditure is third in place after newspapers/magazines and TV, according to the Guardian. In 2007 alone it was worth around €11 billion (£8.7 billion). The UK has the largest online ad market and accounted for €3.8 billion (£3.0 billion) last year, which is 20 percent of the whole ad industry in the country. Search advertising spend in the UK may outrace the entire Internet market in 2008, rising by nearly 30 percent, according to the Guardian.
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