GroupM Updates UK Forecast for 2019

UK advertising is expected to increase to £21.8 billion in 2019, up from £20.5 billion in 2018 according to the latest media and marketing forecasts from GroupM, the world’s leading media investment group. GroupM forecasts 6.1% growth for 2019, down from 7.8% in 2018.

Other key headlines include:

• 2018 was a strong in the world’s fourth-largest advertising economy despite uncertainties: total spending was up +7.8%.
  
• 2019 looks to hold up almost as well: +6.1% growth, aided by decent (if decelerating) underlying economic growth.
• Deceleration should continue into 2020 toward a 4–5% range (forecast +4.6%) as advertising gradually reverts to more normalized growth levels.
• Planning for Brexit contingencies is occupying management bandwidth, which is affecting ad-budget setting, and could potentially lead to reductions.
• Digital advertising now accounts for more than 60% of total UK advertising – more than half of which is search – and still growing at a double-digit pace (around +11% forecast for 2019); digital media “pure plays” represent the largest single group of ad sellers, and two entities (Google and Facebook) are probably around three-quarters of this figure on a gross basis.
• Television has sustained its scale and remains a relatively stable medium in terms of advertising revenues. After hitting a plateau of around £4.5bn, spending was effectively unchanged in 2018 over 2017 and looks set to remain at that level for 2019 and 2020, still accounting for around 20% of media investment.
• In Out-of-Home (OOH), digital formats are increasingly important, accounting for half of spending in OOH during 2018, with further share gains still to come especially as more automation takes root, including the emergence of performance-based targeting and data-driven trading. For now, GroupM forecasts growth exceeding +3% in each of 2019 and 2020.
• Radio also appears set to hold on to its revenue base this year, followed by closer to +2% growth next year.
• Newspapers and magazines now account for less than 10% of media investment on a combined basis in 2019 and beyond, down from more than 50% as recently as 2004.