The Advertising Association (AA) has revised its initial forecast for ad spend growth in the UK, downgrading it from 6.5 per cent to 5.7 per cent to reflect a more cautious outlook over the Eurozone in 2015.
In the AA/Warc Expenditure Report, which measures advertising activity in the UK, full year 2014 forecasts have also been adjusted with growth down from 6.4 per cent to 5.8 per cent.
However, the body said that despite the move, it expects 2014-2015 to be the strongest consecutive growth years for UK ad spend this century.
The latest data shows that UK ad spend grew 4.2 per cent in Q3 2014 to reach £4.3bn. This represents a slowdown versus the 8.5 per cent increase in Q2 2014 which benefited from the football World Cup, but similar growth to Q1 2014 and the second half of 2013. Full year figures for 2014 will be released in May, as actual data from media owners become available.
Tim Lefroy, chief executive at the AA said: “Two years growth at twice the rate of the economy is hardly a recipe for pessimism but ad spend isn’t immune to pressures on other sectors. The underlying story, however, is of a sector continuing to feed growth, jobs and opportunity.”
The report, released today, showed that national news brand print ad revenues declined by 8.8 per cent in Q3 2014 to £257m. Although the figures are worse than expected, digital ad spend increased significantly more than expected to 21.4 per cent or £54m. Altogether the sector recorded a drop of 4.7 per cent for the quarter.
Meanwhile, TV spot advertising rose 3.8 per cent year-on-year, with ad spend of £1bn. Overall an increase of 6.0 per cent is predicted for 2014, with ad spend of almost £4.5bn.