Understanding ad spend pre COVID-19 is invaluable

Since 1998, IAB UK has been reporting on digital ad spend every year. Back then, overall spend stood at £8.1 million, the smartest mobiles had just been upgraded to carry ‘snake’ and Ask Jeeves was the new kid on the search engine block. 

Suffice to say, a lot has changed in the last two decades. We’ve seen huge growth in the digital ad market (take a look at our Adspend Analyser tool to easily chart trends across the years), and our latest report shows that ad spend grew by 15.4% year-on-year in 2019, reaching £15.69 billion. 

This level of market growth in 2019, particularly as Brexit negotiations rumbled on, shows advertisers’ confidence in the power of digital to deliver business results and it’s encouraging to see strong growth trends continue in areas such as smartphone, video display and social. 

But of course, we all know that’s not the full picture. In the four months since 2019 our world has changed dramatically. The COVID-19 outbreak has upended everyone’s daily lives and impacted the global economy to an extent that we have never seen before - and are yet to fully understand. 

It goes without saying that our industry isn’t immune to the fallout and we all know that our current reality bears little resemblance to the pre-coronavirus market. However, having a full set of data for 2019 and robust understanding of where digital ad spend stood going into this crisis is crucial to benchmarking, understanding the impact and charting routes to recovery. 

So what does the latest report tell us about how advertisers were spending before the crisis hit? Smartphone spend continued to be the key driver of growth, with video and social also making gains. Smartphone ads accounted for 56% of all spend, 80% of video investment and 70% of display. Video was the largest display format, making up 46% of overall display, and social spend was up 25% year-on-year to reach £3.59 billion. 

It’s also significant to note that display investment in Gold Standard companies grew at more than twice the rate of non-certified companies (21% vs 9%), demonstrating that advertisers have continued to value the safety and quality that the Gold Standard offers. I would argue that upholding these industry standards is even more important at this turbulent time, with all advertisers looking to minimise waste and deliver true value. 

The latest Adspend report builds on 20 years of spend data to form an important part of our overall understanding of the digital ad market. We’re currently faced with a lot of uncertainty and being equipped with a clear picture of the market before the pandemic will prove to be invaluable as we track the impact of COVID-19 on our industry. While we’re all in uncharted territory and getting used to different ways of doing things, rest assured that we at IAB UK will continue to support our members over the coming months and beyond with the insight, resources and information needed to help us collectively navigate this challenging time.