IAB Digital Ad Spend 2014

IAB / PwC UK Digital Adspend Study

Full Year 2013

1. INTRODUCTION

Background

• Census of major UK media owners

• Digital Adspend – includes online and mobile

• Official Advertising Association figures since 1997

• Information collected each half year

• Data shown by

Category (display, search & classified)

Format (banners, pre-roll / post-roll)

Advertiser sector (consumer goods, finance)

2. METHODOLOGY

Reported and estimated revenue

Reported Revenue

• Survey includes revenues submitted

by 100+ participants plus additional

online recruitment sites and TV

Broadcasters reported by WARC

• The figures are drawn up on the

basis of site declaration and have not

been verified

• Google and Twitter revenues included

in total figures are based on

published financials

Estimated Revenue

• Study includes estimation of Facebook,

Spotify, Millennial, Apple, LinkedIn,

Weather Channel and Mojiva revenues

by the IAB / PwC Advisory Board

• Except for above, reported figures have

not been adjusted for organisations that

did not participate in the survey

95% of 2013

total Adspend

5% of 2013

total Adspend

IAB / PwC Advisory Board

Adjustments and like-for-like growth reporting

Adjustments

• Figures are adjusted for double-counting, based on information provided by survey

participants

• Google display revenues and Google mobile revenues (search and display) are

also estimated by the PwC Advisory Board. This is not incremental spend as already

included in Google total revenues – what we estimate is how this revenue splits

between different formats and platforms.

• Total advertising revenue is reported on a gross basis

Like for like growth reporting

• This study reports like for like growth figures not only for total spend but also for

categories (display, search, classifieds)

• Only companies which submitted in both Full Year 2012 and Full Year 2013 have

been included in the like for like growth calculations

• 57 companies’ figures are excluded from the like for like comparisons for both online

and mobile because they did not report in both Full Year 2012 and Full Year 2013.

More accurate collection of Online

Performance Marketing revenues

Agency Commission

Net Revenue retained by

Affiliate

Net Revenue taken by

Affiliate but passed back

to publisher partner

Origin

ally

report

ed

Tota

l net re

venue n

ow

report

ed

Digital Adspend

Digital includes online, mobile and tablet advertising:

Online • Traditional online advertising viewed on a desktop PC or laptop, accessed via the

internet connection

• Only media spend reported to ensure fair comparison to other media including

• Display advertising

• Search

• Classified

• Other

Mobile

Tablet

• Advertising that has been specifically tailored and served on a mobile device, accessed

via 3G or wifi


• Display advertising (including SMS/MMS)

• Classified

• Search

• Advertising that has been specifically tailored and served on a tablet device, accessed

via 3G or wifi


• Display advertising

2013 Research participants

24 7 Real Media, 4th Screen, 7th Chamber, Absolute Radio, AD2ONE, Adconion,

Addvantage Media, Admaxim, Adpepper, Affiliate Window, Affilinet, AOL, Archant,

Bauer, Be On, Beviacom (MTV), Blinkbox, Blis Mobile, BMJ Publishing Group, Byyd, C

Screens, CBS Interactive, Collective, Commission Junction, Conde Nast, Crimson

Tangerine, Deezer, Dennis Interactive, Digivibe, Disney, DMGMedia, Ebuzzing, EE, ESI

Media, ESPN, Expedia, Exponential, Fiksu, Flurry, Fox Networks, Freemax Media, FT,

Future Publishing, Gamer Network, Google, Guardian, Gumtree, Haymarket, Hearst,

Hibu, IGN, Immediate, Incisive Media, Inmobi, Inskin, Intela, Interactive Prospect

Targeting, IPC, Jobsite, Johnston Press, Linking Mobile, Madvertise, Magnetise,

Maximiles, Microsoft, Mobsta, Net Communities, News UK, Numbate, Odyssey Mobile,

OMG, PERFORM, Performance Horizon, Quidco, R.O.Eye, Racing Post, Rakuten

Linkshare, Reed Business Information, Reuters, Rightmove, Savoo, Shortlist, Specific

Media, Strikead, Supersonic, TalkSport, Tamome, Telegraph, Ten Thousand Hours, The

Institution of Engineering and Technology, The Student Room, This is Global, Three,

Tradedoubler, Trader Media, Tremor Video, Trinity Mirror, Twitter, Unanimis, Unruly

Media, Value Click, Vevo, Vibrant Media, Viewster, Virgin Media, Webgains,

WeRinteractive, Weve, w00t!, Yahoo, YOC, Yume, Zoopla and online recruitment sites

& TV Broadcasters through WARC

• Digital advertising reaches £5.448 billion in 2012

→ Display up to £1,479 million

→ Classified up to £818 million

→ Search up to £3,087 million

This time last year… (2012)

3. UK ADSPEND

HEADLINE RESULTS

SOURCE: IAB / PwC Digital Adspend Full Year 2013


Digital advertising spend – last 10 years

SOURCE: IAB / PwC Digital Adspend 2004 - 2013

£825

£1,366

£2,016

£2,813

£3,350 £3,541

£4,097

£4,822

£5,448

£6,300

£0

£1,000

£2,000

£3,000

£4,000

£5,000

£6,000

£7,000

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

£ M

illio

ns

Market

Share

figures out

soon

4. THE DIGITAL

MEDIA MIX

Which formats go where?

Format Category

Banners / Embedded* Display

Sponsorships* Display

Interruptive formats Display

Email display advertising Display

Tenancies* Display

Pre roll / Post roll video* Display

Social Video Display

Video other Display

Tablet advertising Display

In-game advertising Display

Display other* Display

Format Category

Paid for search* Search

Recruitment classified Classified

Consumer classified* Classified

B2B classified Classified

Solus email Other

Audio advertising Other

Lead generation Other

Mobile SMS/MMS* Other

* Includes mobile

The digital media mix % share of revenues 2013


Category 2012 Share

Search 57%

Display 27%

Classified 15%

Display leads the way in 2013 with highest

like for like growth


Search nears £3.5 billion in 2013


Classifieds growth continues in

recovering economy


Banners & Embedded formats plus video

makes up 92% of digital display


Social media display grows

71% year on year

£0

£100

£200

£300

£400

£500

£600

£700

2009 2010 2011 2012 2013

Social Media Advertising

£ M

illio

ns


Video grows by two thirds

SOURCE: IAB / PwC Digital Adspend Full Year 2013 / WARC.

For 2011 onwards revenues for online video advertising on TV broadcaster websites are taken from WARC / Thinkbox rather than submitted directly to PwC.

Adjustments have been made to the originally published 2011 and 2012 figures to reflect this.

Online Performance Marketing revenues

collected in a separate study

4,000 advertisers spending

£1 billion across12,000 publishers

Lead generation: 13%

Affiliate Marketing: 87% www.iabuk.net/opm

Approximately £300 million of OPM revenue is

also submitted to Digital Adspend

SOURCE: IAB / PwC Digital Adspend Full Year 2013 & The Value

of Online Performance Marketing in the UK 2013

www.iabuk.net/opm

5. INDUSTRY

CATEGORIES

Top 20 online display advertisers 2013

SOURCE: Nielsen Ad Dynamix Jan – Dec 2013

Consumer goods increases lead as

biggest display industry sector

SOURCE: IAB / PwC Digital Adspend 2013 based on 46% reported display revenue for H1 and H2 2013

6. MOBILE

66 Submissions up from 59 in 2012


Strong like for like growth 2012 to 2013


The mobile media mix % share of revenues 2013

Category 2012 Share

Search 69%

Display 29%

Classified 0.4%

SMS & Other 2%


Display also leads the way in mobile

like for like growth


Mobile display dominated by standard formats


Mobile video shows massive growth


2013 mobile display in app vs browser

*Note: Based on a sample of 48 participants and 2 estimated companies, accounting together for c.32% of total standard display revenue


2013 mobile rich media spend

2012 21%


One third of all social display

spend is in mobile


Consumer goods is also the biggest

mobile display industry sector

Based on 15% of total mobile display revenues


Consumer goods gains share in 2013


1%

2%

2%

4%

9%

9%

8%

10%

13%

22%

20%

1%

2%

2%

4%

7%

7%

9%

9%

11%

22%

24%

Leisure Equipment

Business & Industrial

Government, Social, Political Organisations

Travel & Transport

Motors

Finance

Technology

Telecomms

Retail

Entertainment & The Media

Consumer Goods

2013

2012

Mobile is now 16% of digital


0.8% 1.1% 2.0%

4.2%

9.7%

16.3%

2008 2009 2010 2011 2012 2013

17% of total search (2012 12%)

23% of total display (2012 10%)

0.3% of total classifieds (2012 0.2%)

Mobile growth vs online 10 years ago

£19.4m £51.0m £153.1m

£165.7m

£196.7m

£465.0m

£825.1m

£1,366.5

£2,853.3

£28.6m £37.6m £83.0m

£203.2m

£528.5m

£1,031.0

1998 1999 2000 2001 2002 2003 2004 2005 2006

Online Adspend Mobile Adspend

2008 2009 2010 2011 2012 2013 2014? 2015? 2016?


7. TABLET

30 Tablet submissions

Tablet dedicated display ad spend

*Note: This figure relates to tablet

specific advertising only (i.e. not

including internet advertising

displayed on a tablet by default).

It is based on revenues reported

by companies participating in the

online and mobile surveys who

were able to report this figure

separately, and can thus

underestimate the overall size of

the tablet dedicated advertising

spend

£34.4m*

2012 £6.8m SOURCE: IAB / PwC Digital Adspend Full Year 2013

8. ADDITIONAL DATA

Brand advertising online is 17% of total

SOURCE: IAB estimate based on IAB / PwC Digital Adspend Full Year 2013

2013 showed a shift in revenue models

Estimate only – based on 33% of measured revenue


9. LOOKING AHEAD AND

SUMMARY

Forecasts for 2014

Source: This Year Next Year Summer 2013 (GroupM) & Enders Analysis

Full year 2014

forecast GroupM

Enders

Analysis Average

Advertising Market +6.0% +4.6% +5.3

Online +14.3% +15.1% +14.7

Display +14.1% +14.5% +14.3

Search +15.8% +23.1% +19.5

FirstPartner Forecast 2014-2018

Source: FirstPartner

734 849

972 1,078

1,178

496

611

703

784

859

102

142

199

249

275

21

25

30

34

35

0

500

1,000

1,500

2,000

2,500

2014 2015 2016 2017 2018

£ millions

Messaging

Video

Display (Banners)

Search

Total

£2,143m

Total

£2,346m

Total

£1,903m

Total

£1,627m

Total

£1,353m

UK Mobile Advertising Spend Forecast 2014-2018

Summary for 2013

• Digital Adspend grows to £6.300 billion in 2013

• Up 15.2% on a like for like basis

• Display up 22.1% on a like for like basis - £1,862.1 million

• Classified up 8.9% on a like for like basis - £886.5 million

• Search up 14.2% on a like for like basis - £3,494.9 million

• Video, Social and Mobile continue to power display

• Consumer Goods and Finance are the top spending

display sectors, Entertainment and the Media now third

• Mobile spend soars by 93.3% to reach £1.031 billion


Big thank you

and all contributing media owners

[email protected]

0207 050 6969

mailto:[email protected]

Disclaimer

The IAB retained PricewaterhouseCoopers LLP (the UK firm) (‘PwC’) to compile the online Adspend figures

collected by the IAB from its members in H2 2013 and to deliver to the IAB the topline figures collated from

this review; PwC has not verified the information which it received from the IAB, and provides no opinion or

other form of assurance with respect to such information.

The publication has been prepared for general guidance on matters of interest only, and does not constitute

professional advice. You should not act upon the information contained in this publication without obtaining

specific professional advice. No representation or warranty (express or implied) is given as to the accuracy or

completeness of the information contained in this publication, and , to the extent permitted by law, neither the

Internet Advertising Bureau UK (the ‘IAB’) nor any of the IAB’s contributors/subcontractors accept or assume

any liability, responsibility or duty of care for any consequences of you or anyone else acting, or refraining to

act, in reliance on the information contained in this publication or for any decision based on it.

Data & Analytics

IAB Digital Ad Spend 2014