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H1 2009 UK online adspend study

H1 2009 UK online adspend study. Agenda. Introduction Study methodology Market background and trends UK online adspend – headline results Online in context The digital media mix Industry categories Summary Looking ahead… Questions. 1. Introduction. Background.

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H1 2009 UK online adspend study

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  1. H1 2009 UK online adspend study

  2. Agenda • Introduction • Study methodology • Market background and trends • UK online adspend – headline results • Online in context • The digital media mix • Industry categories • Summary • Looking ahead… • Questions

  3. 1. Introduction

  4. Background • Census of all major UK online media owners • Official Advertising Association figures since 1997 • Information collected each half year • Analysis available by • Format • Industry category

  5. 2. Methodology

  6. A brief history… • The IAB has been working with PwC since1997to survey the value of the online advertising market • We have run projects in Europe and North America to assess the size of the interactive media markets • These figures have become theindustrystandardfor measuring advertising spend • 135companieshave participated in the survey • Reported figures arenotadjusted to account for other organisations that have not participated • Total advertising revenue is reported on agrossbasis • The figures are drawn up on the basis of site declaration • They cover thousands of UK websites, but by no means all

  7. Research participants Absolute Radio Accelerator Acxiom Ad2-one Adept Scientific AdLINK Ad Pepper Ad Revenue AdSales4U Affiliate Window Affiliate Future AOL AskAssociated Northcliffe Digital Autotrader Bauer BBC WorldwideBloombergBlue Lithium BMJ Bolt BlueBountyBSkyBBuy AssociationBuy.at (Perfiliate)Channel 4ChinwagChrysalis RadioClassic FMCNET Conde NastConfetti Commission Junction Dennis InteractiveDGMDrive PMDixons Double Fusion E-circle Economist EDR E-Type Euroclick Everyclick Exchange and Mart .Fox Faversham House Group Financial Times Find.co.uk FindapropertyFish4 FiveFlirtomatic Friends Reunited Future Publishing Fox Networks GCap Radio Glam Media Global Radio InteractiveGoogleGuardian Habbo IDS Hachette FillpacchiHandbag HaymarketHelloIDGIndependent I.E.T (Institute ofEngineering and Technology) IPC Media IPTi-Points Is4Profit ITN ITV iVillage Jetix Jobs.ac.uk JobsiteJohnston Press Last FMLootLycosManchester Online Media BrokersMemediaMiva MoneyextraMonsterMSN My SpaceNational MagazinesNet CommunitiesNetrecruitNews International Online MediaGroupOrange Oridian Overture PigsbackPlatform APrime LocationProperty Finder Real MediaReed Business Information Reuters Right MoveScotland OnlineSift Simply Media TV Specific Media SRH Skupe TeamtalkTelegraphTescoTiscali TMN Media Tradedoubler Trinity MirrorUK Net GuidesUKTV UnanimisUpmystreet U Target Valueclick Viacom Brand Solutions Vibrant Virgin Media Webgains Wallpaper* WME WebTV Workthing Yahoo! Yahoo! NetworksYell …Plus further recruitment sites, courtesy of WARC Representing thousands of UK websites

  8. 3. Market backgroundand trends

  9. Worst since Great Depression?

  10. Worst recession since the Great Depression…

  11. Marketing budgets marked down again in Q1 09

  12. Marketing budgets cut at slower rate in Q2 09

  13. Outlook for 2009 online forecasts * * As at March 2009.

  14. UK economy resumes..

  15. Green shoots appearing

  16. Where were we this time last year?.. • H1 2008 was a landmark year for online with ad spend reaching £1.669.6 billion for the half year • The medium grew by 21% from £1.334 billion in 2007 • Online was 18.7% market share • Our 2009 H1 forecast was flat or minimal growth for online

  17. Number of internet users* in the UK 49% online pop 73% UK Pop 44% online pop 49% Online Pop 71% UK Pop 44% Online Pop Internet users going online more than once a day Number of people online Source: NRS UKOM: Jul-Dec 2008; Jan – June 2009; *adults using the internet at least once in the last 12 months

  18. Continuous growth in online audiences and broadband penetration % Broadband access at home Online audience (millions) Source: BMRB Internet Monitor

  19. Majority of broadband services are now above 2 MB 56% of home broadband users have used wireless broadband at home in the last month (May 2009) Re-Based: All Internet users aged 15+who know their broadband connection speed Source: BMRB Internet Monitor May 2007; May 2008; May 2009

  20. Online second only to TV% of media time for all internet users Weekdays Saturdays Sundays Base: All Internet users aged 15+ Source: BMRB Internet Monitor, May 2009

  21. 4. UK Online Adspend StudyResults for the half year to June 2009 Prepared by PricewaterhouseCoopers for the IAB

  22. £1,759.6mmarket in H1 2009Anincreaseof£90.1m year-on-year Source: PricewaterhouseCoopers / Internet Advertising Bureau / WARC

  23. H1 2009 vs. H1 2008 4.6% increase on a like for like basis Source: PricewaterhouseCoopers / Internet Advertising Bureau / WARC

  24. Online advertising reaches record £924m in Q1 2009 ‘07 ‘08 ‘06 ‘01 ‘02 ‘05 ‘03 ‘04 £ millions Source: PricewaterhouseCoopers / Internet Advertising Bureau / WARC

  25. 5. Online in context… Breaking market trends in the UK ad industry

  26. The Big news in World Media is….

  27. Online Spend has Overtaken TV! The UK is the first major economy to achieve this feat

  28. The biggest news in media

  29. H1 2009 market share 23.4% (18.7% in H1 2008) % share of revenues for January to June 2009 Total advertisingmarket £7.520bn IAB estimates for actual ad spend by format are based on samples of categorised revenue from key IAB members provided by PwC. Data excludes unclassified figures. Source: PricewaterhouseCoopers / Internet Advertising Bureau / WARC

  30. Online only medium showing growth in H1 2009 Year on year growth for H1 2009 Total advertising market growth = -16.0% Source: PricewaterhouseCoopers / Internet Advertising Bureau, The Advertising Association / WARC: WARC estimate for directories.

  31. Online’s share growth accelerates to 23.4% Market Share Source: PricewaterhouseCoopers / Advertising Association / Internet Advertising Bureau / WARC

  32. Television Press - Display Direct Mail Press - Classified Internet Outdoor Radio From the smallest to the largest in 6 years £ millions N.B. WARC Recruitment data included from 2003 Source: PricewaterhouseCoopers / Internet Advertising Bureau / Advertising Association / Radio Advertising Bureau / WARC

  33. Online overtaken Press Display and TV Half year 2009 £7.520bn Directories are estimated Source: PricewaterhouseCoopers / Advertising Association / Internet Advertising Bureau / WARC / Radio Advertising Bureau.

  34. Summary – H1 2009 • Online advertising is the only medium showing growth in H1 2009 • Internet advertising reaches £1,759.6m in H1 2009 • Online achieved a share of 23.4%, up nearly 5 points from H1 2008 (18.7%) • The market grew on a like for like basis by 4.6% year-on-year, still maintaining strong growth • Online is the largestmedia in the UKfor H1 2009

  35. 6. The digital media mix The developing mix of ad products

  36. The digital media mix % share of revenues for H1 2009 Half year total £1,759.6m IAB estimates for actual ad spend by format are based on samples of categorised revenue from key IAB members provided by PwC. Data excludes unclassified figures. Source: PricewaterhouseCoopers / Internet Advertising Bureau / WARC

  37. The digital media mix +10.6% -2.5% 0.2% £ millions IAB estimates for actual ad spend by format are based on samples of categorised revenue from key IAB members provided by PwC. Data excludes unclassified figures. Source: PricewaterhouseCoopers / Internet Advertising Bureau / WARC

  38. The digital media mix Year on year comparison £ millions IAB estimates for actual ad spend by format are based on samples of categorised revenue from key IAB members provided by PwC. Data excludes unclassified figures. Source: PricewaterhouseCoopers / Internet Advertising Bureau / WARC

  39. Strong growth of Search continues £m Source: Internet Advertising Bureau / PricewaterhouseCoopers

  40. Growth in further classifieds from H1 2009 £m Source: Internet Advertising Bureau / PricewaterhouseCoopers

  41. Classifieds led by key players

  42. Display: formats still dominated by banners & rich media £m Source: Internet Advertising Bureau / PricewaterhouseCoopers

  43. The display digital media mix % share of display revenues for the half year to June 2009 £237.9m £13.2m £6.7m £9.2m £7.2m £11.4m £30.8m Half year display total £334.6m £18.2m IAB estimates for actual ad spend by format are based on samples of categorised revenue from key IAB members provided by PwC. Data excludes unclassified figures. Source: PricewaterhouseCoopers / Internet Advertising Bureau / WARC

  44. Formats summary – H1 2009 With revenues of £1,085.4 m in H1 2009, search maintained its dominant position YoY, display was flat (0.21%) at £334.6m while search increased by 10.6% and classifieds were down by -2.5% to £339.7m Video pre and post roll saw growth of 196%, and display affiliate grew by 111% Classifieds: recruitment declined by -31.8% to £123.6m and other classifieds grew by 29% to £216.0m Source: Internet Advertising Bureau / PricewaterhouseCoopers

  45. 7. Industry categories

  46. Display Sector Market Shares Based on 86% of total display ad spend revenues * IAB estimates for industry sector shares are based on samples of categorised net revenue from key IAB members provided by PwC. Data excludes unclassified figures and covers 85.5% of online revenues in H1 2009. Source: PricewaterhouseCoopers / Internet Advertising Bureau / WARC

  47. Industry sectors summary – H1 2009 • Technology is the largest category with 19%, however Telecomshas shown the largest share point growth (+3.6 points) • Finance and Entertainment & Media are third and fourth respectively • Consumer Goods has grown almost 2 share points to 8.1%.

  48. 8. Summary

  49. Summary • Online ad spend grows by 4.6% year-on-year(on a like for like)to reach £1,759.6m in H1 2009 • Online achieved a share of 23.4%, making it the largest advertising format in the UK • Online now ahead of TV and Press Display • 23.4% of all advertising budgets are now spent online • Nearly £1 in every £4 of ad spend goes online

  50. Summary • Search experienced strong growth of 10.6% • Classified declined slightly by -2.5% in H1 2009 (Recruitment Classifieds declined dramatically by -32%) • Display (0.2%) had a very good year during difficult trading conditions • Technology takes the top spot for display at 19.1% • Telecoms (13.3%) and Finance (13.2%) take second and third positions.

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