After ad budgets frozen during the pandemic were unleashed, ad spending looks like it may return to normal.

2022 UK ad spend exceeded pre-pandemic levels and will now keep growing at more familiar rates, according to Dentsu's Global Ad Spend Forecasts, January 2022.


2021 spend surged

According to Dentsu, last year UK ad spend bounced back after the earlier stages of the COVID-19 pandemic:

"There was strong growth across all channels beginning in Q2 2021, contributing to overall year-on-year growth of 26%.

"Cinema and OOH (out-of-home) showed particularly strong growth in 2021 following severe declines in 2020.

"Digital, the largest media channel, was also up 28.5% year-on-year.

"TV revenues were up 23.9% in 2021."

2022 growth moderates

Now Dentsu expects 2022 UK ad spend to continue growing, but at the more muted rate of 5.4% annually:

"In 2022, we expect to see (UK) spend 21% up on 2019 levels.

"(Growth will be) driven by above-market average growth
in digital, which itself makes up around 65% of overall market spend.

"OOH and cinema are on course to continue their strong recoveries from the significant declines experienced in 2020 and early 2021."

Return of 5% growth

Dentsu is essentially hoping the worst pandemic economics effects are over, using indicators like optimism about an easing in the global microchip shortage.

It is, therefore, forecasting a return to annual UK ad spend growth of 5%+ in each of the coming years.

That is the kind of picture the UK industry saw in 2019, before the pandemic hit.

But Dentsu acknowledges: "Many factors could influence these numbers, including further COVID-19 lockdowns and ongoing supply chain issues."

Global comparison

The 26% UK growth in 2021 was greater than the 15% seen in Western Europe (UK, Germany, France, Italy and Spain) and the 17% seen globally, according to Dentsu.

But, for 2022, Dentsu expects the global ad market to grow at 9.2%. That is almost double the forecast UK rate, driven somewhat by US factors like midterm election ad spending.

Dentsu's Global Ad Spend Forecasts, January 2022