Online ad spend in the U.K. overtook advertising on mainstream commercial TV last year, according to Britain's Office of Communications. Paid search grabbed over half of online ad dollars spent in the U.K. in 2007.
The watchdog's annual Communications Market report, released today, states that the U.K.'s online advertising market grew by 40 percent in 2007, and by 70 percent in each of the past five years, reaching a total of $5.2 billion (£2.8 billion) last year. Web ad spending represented 19 percent of total media revenues, according to the report from the U.K. government body which regulates the communications and media industries.
By contrast, TV ad spend remained unchanged at $6.5 billion (£3.5 billion), with mainstream commercial channels -- ITV1, Channel 4, S4C and Five, accounting for $4.5 billion (£2.4 billion) the report says.
Paid search accounted for the lion's share of online revenue, or nearly $3 billion (£1.6 billion) of the total $5.2 billion (£2.8 billion), with display and classified advertising making up the remainder.
According to Alex Marks, head of marketing for Microsoft Advertising U.K., the shift mirrors consumers' changing consumption habits. Consumers are becoming more easily distracted, and non-linear in the way they consume media. They are more difficult to entertain, have lower attention spans and practice ad avoidance techniques, he told ClickZ News.
The report itself says that "Television advertising revenues will continue to face challenges," citing technologies such as digital video recorders which allow users to skip commercial content, and the emergence of online video.
Marks said this highlights a need for advertisers to focus increasingly on creative campaigns, in order to draw in consumers, and make ad environments something they seek out, rather than run away from.
Overall, the report valued the U.K. advertising market at $27.8 billion (£14.9 billion) in 2007, with year-over-year growth of 6.3 percent.
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