UK digital ad spend reaches £13.8B in H1 2023 despite economic volatility

The UK’s digital advertising market demonstrated resilience by attracting £13.8 billion in ad spend during the first half of 2023, as revealed in the IAB UK and PwC‘s H1 Digital Adspend update. This performance marked a 5% year-on-year growth, even amid an uncertain economic environment characterized by high inflation.

The H1 Digital Adspend update provides a condensed report for the first half of the year, with full-year Digital Adspend data released annually in April. It covers spend data in various categories, including search, display (both video and non-video), classified, mobile, non-mobile, and others.

Video ads exhibited the most robust growth, with an 11% increase, as advertisers increasingly recognized the brand-building potential of this format. The popularity of short-form video content was a contributing factor to this trend, as data from Ofcom’s Media Nations report indicated that over a third of UK adults watch short-form online videos daily, rising to 68% among 15 to 24-year-olds. Overall, spend on display formats (combining video and non-video) grew by 8% year-on-year.

Search ads continued to dominate the market, representing 50% of the total ad spend. The category registered a 5% growth, totaling nearly £7 billion in the first six months of 2023.

In contrast, classified ads were the only format to experience a decline in spending, with a 13% drop, though this was less severe than the 21% decline observed in H1 2022. When examining device-specific trends, mobile ad spend increased by 9%, while non-mobile formats remained relatively stable.

The ascent of short-form video content came as no surprise, as a late 2022 report had already foreshadowed its increasing share of ad spend in 2023, coinciding with the growth of social advertising. Additionally, there were high expectations for global mobile ad spending, with forecasts projecting it to reach $362 million in 2023, driven by the surge in mobile app usage.

Written by Gizem Yılmaz


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