An insight by Anna Fitzpatrick, our Junior Research Analyst
The uncertainty surrounding Brexit has rattled the nation and a recent Enders analysis forecasted that in the case of a no-deal Brexit, the UK advertising industry may fall into its first recession in a decade. Despite this doom and gloom, fresh forecasts from Barclays cited 2019 as the year digital ad spend will hit £15bn.
It’s true that Brexit will affect all sectors in some way, but the most successful brands will be those that take hold of the opportunity Brexit presents, adapt their strategies and remain agile and focused on overall business objectives. Stephen Woodford, the Chief Executive of the Advertising Association (AA) stated that ‘in uncertain times, thinking and waiting for bad stuff to happen is wrong, it is about being entrepreneurial and bold’. Brands must respond to the economic uncertainty with sensible action, directing marketing spend to the channels that are proved to deliver tangible return on investment (ROI).
UK digital advertising expenditures increased by over £6 billion between 2007 and 2016, from £2.81 billion to £9.2 billion – the increase of data touchpoints and measurement capabilities puts digital performance marketing in a strong position going forwards. David Kershaw, M&C Saatchi’s Chief Executive recently told Campaign that digital performance marketing is ‘driving today’s sales’, citing the reason for UK brands still spending in this area as providing an ‘immediate short term return’ for clients needing to gain a granular understanding of the success of their campaigns. The measurement capabilities of data-driven performance marketing are more important now than ever before for brands looking to remain resilient in an economic downturn. Tracking performance across channels allows the marketer to optimise budgets by reducing spend on ineffective touchpoints and doubling down on those already delivering strong results. It is not surprising then that the UK digital advertising is expected to grow by 9.8% in 2019 and why, as Kershaw noted, ‘we’re not seeing any non-commitment from clients’ despite wider economic problems.
If you’d like to discuss maximising ad spend and driving sales in 2019, get in touch today.