With total UK TV advertising spend having dropped for the first time in eight years, advertising in the UK grew at its slowest rate for four years — at 1.3% during the first quarter of this year — according to the latest Advertising Association/Warc Expenditure Report.

This was the 15th consecutive quarter of growth, reaching £5.3bn, although TV advertising spend was found to be down by 6.2%, the first fall since 2009. Just yesterday, ITV reported external revenue was down by 3% during its first half year, unaided by the 8% decline in net advertising revenue.

According to the report, the TV sector is expected to recover to reach 2.5% growth in 2018.

Despite a general decline in traditional media advertising revenue, cinema recorded a year-on-year growth of 27.6% for the quarter. This made it the only non-digital format to achieve growth during the three-month period.

Online ad spend continues to grow via internet revenues, including digital across news and magazine brands, TV and radio. Digital formats were found to have grown across the board with national news brands experiencing a 25.4% growth and radio seeing an uplift of 8.1%.

Breaking this down, national newspapers saw their total ad revenue decline by 6.6%, despite that being the industry’s best performance in two-and-a-half years, but digital was up by 25.4% year-on-year, making up over a quarter of advertising revenue. Regionally, print income dropped by 18.8% and digital fell by 2.7%, which meant a combined decline of 16%.

Magazine brands also struggled, registering a loss in print income of 16.1% with digital lagging as well, losing 8.9%.

Elsewhere, digital out-of-home was up by over a quarter. But despite its digital growth, the sector saw spend recede overall by 0.6% during the first quarter of the year while digital marketing outperformed its forecast but was still down by 1.5%.

Mobile growth was reported as being up by 36.2% for Q1, while over a quarter of advertising spend was found to go towards search.

In a statement, Stephen Woodford, chief executive at the Advertising Association said: “As business sentiment suffers, it’s no surprise to see ad-spend come under pressure – but the market overall remains resilient. Beyond these numbers, our sector is a huge source of inward investment and exports and should be a priority for Government as we focus on business beyond Brexit.”

Adding his view, James McDonald, senior data analyst at Warc, commented: “The latest data show that large retailers – particularly supermarkets – and major food brands reined in their TV spending by 25% during the first three months of 2017, instead committing to cutting prices on the shelves as household expenditure wanes.

“Higher inflation and slow wage growth has put a squeeze on consumer spending, while business confidence has weakened following the unexpected and indecisive general election result in June. These underlying stresses have resulted in a downgrade to our full-year expectations for UK ad market growth, almost all of which will come from digital formats.”

As a result of these numbers the outlook for the year has been downgraded to predict a 2% growth overall, but will recover next year to 2.6% due to it being a World Cup year.

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By Expat