Smartphone ad expenditure drives UK digital growth – video leads in display

Mobile is a major driver of the UK’s digital advertising market, according to the latest Interactive Advertising Bureau (IAB) and PricewaterhouseCooper (PwC) Digital Adspend 2017 report.

Overall, the UK digital ad market grew 14.3% to £11.55 billion in 2017. The smartphone market was worth £5.2 billion, which represents a 37.4% increase compared to the previous year.

Indeed, smartphone ad spend is now worth 45% of all digital advertising.

“The steep growth in smartphone ad spend isn’t surprising,” explained Lolly Mason, Celtra Inc, Chair of IAB UK’s Mobile Steering Group. “Ad spend hasn’t yet caught up with our changes in media consumption and so we’re continuing to see a fairly sharp adjustment. This is likely to continue until beyond the time that smartphone spend outstrips desktop spend.”

Meanwhile, 61% of display expenditure is now directed toward smartphones.

Unsurprisingly, video is the dominant display ad format at 39%.

“Video surpassing the £1bn mark, to become the largest display format, feels like a watershed moment for the digital industry. The growth over the past 5 years is testament to the fact that video delivers and advertisers are using it to drive business results,” added Steve Doyle, Inskin Media Chair of IAB UK’s Video Steering Group.

However, outstream now ranks ahead of pre-post roll video ad formats. It makes up 56% of all video ad spend compared to 42% on pre-post roll.

Justin Taylor, Managing Director at digital video advertising company Teads commented:

“[The] growth [of outstream video] can be attributed to demand from advertisers for clean advertising in brand-safe, viewable environments following the scandals around user-generated content throughout 2017. Users have also got behind outstream – their engagement with the format shows it delivers a fantastic, non-intrusive experience, enhanced by creative and immersive elements such as 360 degree video and chatbots.”

The report further unveiled that social revenue grew 38% year-on-year to £2.39 billion.

At the same time, programmatic’s share continues to climb with 80% of display ads now being traded programmatically.