Advertising in UK – market, trends, government regulation, innovation

Mark Leavermark.leaver@uktispecialist.com+44 (0)7884 490937

Defining Advertising?

Advertising is a form of communication intended to persuade an audience (viewers, readers or listeners) to take some action, usually to purchase or consume a product or service.

Defining Advertising?

Advertising in the UK

• 13,000 businesses in the sector • Employs 250,000 people• Produces £6.2 billion of the UK GVA

annually

Advertising is important

Advertising funds 75% of commercial television, 95% of national press, 80% of magazines, and 95% of commercial radio in the UK.

It also drives innovation.

Advertising is important

Advertising locations

70% in London

6% in NW

UK Advertising

• Global market lead

• Household names (WPP, Saatchi etc)

• Recognisable output

UK Advertising

Advertising industry

Associations: Advertising Association, IPA, IAB

Skills: Creative SkillsetPress: Campaign, Brand RepublicIndustry built on renowned creative

Advertising Awards

D&AD as recognised gold standardBIMA for interactive & digital

UK Advertising market

UK Advertising market

UK Advertising market

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

0

2000

4000

6000

8000

10000

12000

14000

16000

18000

TOTAL

Press

TV

Internet

Outdoor & Transport

Radio

Cinema

Advertising Revenue by Medium 2000-2011

£m

Source: AA/Warc – Based on current prices

* Total revenue figure excludes all sponsorship. TV figure includes sponsorship, Radio includes branded content

% Share by medium of total ad revenue

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

0

10

20

30

40

50

60

Press

TV

Internet

Outdoor & Transport

Radio

Cinema

%

Source: Advertising Association Expenditure Report 1995-2011Note: Figures are at current prices and gross.

Advertising – regulation issues

• Privacy / Data / Opt In

• Product placement / sponsorship

Advertising break

Advertising as driver of innovation

• War for attention

• Amplifies disruption

Key drivers – UK digital market

• 9th largest global internet population• Highest per capita online spend in G20:

UK €1563• 58% smartphone penetration• 24.7M UK consumers using m-commerce• 12% UK households own iPad / tablet• 37.4M Facebook users

Key drivers

• World has changed• Flexibility of digital• Highly targeted• Track ROI• Generate dialogue

Impact of social media

• Impossible to overstate• Interaction not broadcast• Enable peer advocacy• Generate exploitable data• Viral

Peer advocacy

Viral

• Cadburys Gorilla ad 2007• Millions YouTube views• Generated parody versions• 6% sales uplift• P&G 2012 14M views / 2M+

shares

BUT….

Avoiding advertising

• Second screen / multiplatform• Triggered content – Shazam• Premium service - Spotify

New platforms

• Google ($36Bn+ globally 2011)• Facebook ($3.8Bn globally 2011)• App / In game• Mobile

New dialogues - Burberry

New dialogues - Dominos

New dialogues - Heineken

New dialogues - Cadbury

New formats - Blippar

New formats - Kiosked

New formats - Matmi

New formats - Vouchercloud

Likely FDI prospects:

Major ad agencies have London presence so:• Audience measurement• Audience engagement• Creative innovation• Effectiveness / ROI

Thank you

Mark Leavermark.leaver@uktispecialist.com+44 (0)7884 490937@mark_leaver