Advertisers spend more on net than TV

LONDON: The UK has become the first major economy where advertisers spend more on internet advertising than television, with a record GBP1.75 billion spent online in the first six months of the year.

It is a watershed for the embattled TV industry, which has been the leading ad medium in the UK for almost half a century. It took the internet little more than a decade to overtake it.

UK advertisers spent GBP1.75 billion on internet advertising till the end of June, a 4.6 per cent increase year-on-year, according to a report by the Internet Advertising Bureau (IAB) and auditors PricewaterhouseCoopers.

In 1998, when IAB first measured internet advertising, just GBP19.4 million was spent online. The internet now accounts for 23.5 per cent of all advertising money spent in the UK, while TV ad spending accounts for 21.9 per cent.

IAB originally predicted that internet ad spending would overtake TV at the end of 2009. However, the crippling advertising recession accelerated this by six months. TV advertising spending fell about 17 per cent year-on-year in the first half, to about GBP1.6 billion, according to the report.

The IAB’s figures show that of the total of GBP1.75 billion spent on internet advertising, GBP1.05 billion, or 60 percent, was spent on search advertising on websites including Google, up 6.8 per cent year-on-year.

Online classified advertising grew by 10.6 per cent year-on-year to GBP385 million, about 22 per cent of total internet ad spending. But online display advertising, such as banners on websites, fell by 5.2 per cent year-on-year, to GBP316.5 million. This was 18 per cent of all internet ad spending.

The ray of light in the online display ad sector was the nascent, but rapidly growing, online video advertising sector. IAB estimated that this grew by close to 300 per cent year-on-year, to almost GBP12 million.

Thinkbox, the UK TV marketing body, has taken exception to IAB’s figures, arguing that the internet is now mature and diverse and it is inaccurate to collate all the figures as if it is a single medium.

Adam Smith, futures

director at WPP’s combined media operation, Group M, argued that the internet’s share of total UK ad spending could be close to its peak.