Digital ad spending surges by 11% in 2023 amidst economic challenges
Despite a modest 0.1% growth in the UK economy, the digital advertising sector experienced significant advancements in the last year. The UK's digital advertising market expanded by 11% to reach £29.6bn, reflecting increased investments by brands in the digital landscape.
Source: IAB/PwC
In 2023, the UK economy saw a slight growth of only 0.1%. However, digital advertising showed significant progress during the same period.
The digital advertising market in the UK experienced an impressive 11% growth in 2023, reaching a total value of £29.6bn. This growth was driven by increased investments from brands in digital platforms like connected TV (CTV), podcasts, and retail media.
Retail media spend increased by 12% in 2023 to £283m, as advertisers sought to utilize first-party data before the cookie crackdown. Group M predicts that this trend will continue, with an expected 8.3% growth in retail media investment in 2024, reaching an estimated $119.4bn (£96.3bn) globally.
According to the IAB and PwC's Digital Adspend report released on April 24th, podcast advertising, CTV, and digital out-of-home all experienced double-digit growth rates. Podcast advertising saw a 23% increase, while CTV and digital out-of-home grew by 21% and 12% respectively.
Social video, like ads on platforms like TikTok, increased by 20% last year. This shows that advertisers are recognizing the importance of reaching audiences through online entertainment and utilizing various digital channels available, according to IAB UK CMO James Chandler.
Mobile advertising expenditure also saw growth, rising by 15% to £16.7bn last year. This marks a significant increase from the 4% growth seen in 2022, highlighting the expanding market for mobile advertising.
Chandler adds that as third-party cookies are being phased out, the landscape of digital advertising is changing. This upcoming year is expected to bring about new developments that will shape the industry. It is positive to note that advertisers are now focusing on engaging platforms and are expanding their investments in various online solutions.
Editor's P/S:
The UK's digital advertising industry is thriving, with an 11% growth in 2023. This is a testament to the increasing importance of digital channels for reaching audiences. Advertisers are recognizing the value of platforms such as CTV, podcasts, and retail media, which offer targeted advertising opportunities. The phasing out of third-party cookies is also driving innovation in the industry, with advertisers seeking new ways to engage with consumers.
The growth in mobile advertising is particularly notable, reflecting the increasing use of smartphones and tablets. This trend is likely to continue, as mobile devices become even more integral to our daily lives. Overall, the future of digital advertising in the UK looks bright, with continued growth expected in the years to come.
