Digital to boost UK ad market to £17.7bn by 2015

The value of the UK advertising market is set to increase by 4.8% in the next four years to £17.7bn as brands pour spend into online marketing to meet growing consumer demand for digital media.

PwC says internet advertising is projected to rise by 11.2% between now and 2015, the only segment of the UK market set for double digit growth, according to its Global Entertainment and Media Outlook report.

Search advertising has until now been the principal driver of online advertising, but the report adds that this is expected to change in 2012 when advertisers will put more spend into social networking sites and classified advertising as the economy recovers.

Phil Stokes, head of entertainment and media at PwC, says: “With advertising revenues returning to pre-recession levels, the advertising pound is being spent in many new and different ways.

“Product placement, sophisticated social media campaigns and internet advertising are all becoming part of truly multimedia campaigns for advertisers who are themselves increasingly involved in a dynamic conversation with their customers.”

UK consumer spending on media and entertainment in the period is set to grow at a slower rate, at a rise of 2.7% to reach £32.7bn, with a further £9.2bn of spending on internet access to media.

Mobile internet access will boost consumer entertainment and media spend over the next four years, with the number of users in the EMEA region set to double.

Music is the only sector where consumer spend is set to drop in the period. Although digital is forecast to outgrow physical spend, overall, music spending is set to drop by 1.1% to $22bn (£13.5bn).

The global filmed entertainment market will grow to $115bn (£70.5bn) in the period, boosted by 3D, Blu-Ray, the increased penetration of tablets and faster broadband.

The video games market is expected to expand by 8.2% to $82bn (£50.3bn), largely fuelled by the increase in online gameplay.

Other findings from the report include:

  • Latin America will be the fastest growing region for entertainment and media spend. It is projected to grow 10.5% to $109bn (£66.8bn)
  • Twelve countries will spend more than $25bn (£15.3bn) on media and entertainment by 2015. The fastest growing countries by spend are China (11.6% increase) and Brazil (11.4%).

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