More than £5.4bn (AUD $8bn) was spent last year on advertising on digital platforms such as the internet and mobile phones, new figures have revealed.
Despite the tough economic conditions in 2012, the UK’s digital ad spend was up 12.5%.
There was strong growth in online social media advertising – it grew 24% to £328.4m.
In the last three years social media spend has increased 383%.
Online and mobile sponsorship advertising grew 34% to £65.7m, accounting for 5% of digital display.
The figures from the latest Internet Advertising Bureau UK (IAB) digital adspend report, conducted by PwC, show that spending on mobile advertising up 148% to £526m.
The boom has been fuelled by high uptake of new technology – by December 2012 64% of the UK population owned a smart phone.
Tim Elkington, IAB’s Director of Research and Strategy, said:
“Mobile has reached this milestone because marketers are becoming more attuned to the ‘always on’ nature of consumers who expect to engage with content wherever they are.
“Consequently, advertisers are increasingly buying integrated campaigns across online and mobile rather than regarding mobile as an afterthought.
“There’s simply so much buzz around mobile.
“In the last six months, 20 more of the UK’s top 100 advertisers have produced mobile-optimised websites; 4G mobile ultra-broadband is enabling a new era of richer content consumption with tablets predicted to outsell PCs in 2013.
“This will help maintain mobile’s significant momentum in attracting both consumer attention and advertising pounds.”
In the past decade the digital advertising market has grown from less than £200m to £5.4bn.
Last year the consumer goods sector (FMCG) overtook the finance sector as the biggest spender on digital display advertising – accounting for almost 16% of display ad spend in 2012.
FMCG’s share has almost doubled in the last three years – from 9% in the first half of 2009 – as FMCG marketers have realised digital’s ability to deliver brand awareness, particularly as an amplifying element in integrated media campaigns.
Anna Bartz, Senior Manager at PwC, said: “The advertising market is shifting toward storytelling and integrated campaigns which give greater prominence to video and display formats with a higher degree of interactivity with the target audience.
Over the past two years, the digital advertising revenue model has also changed from an emphasis on direct response to being more about branding and awareness.”
The top five display advertising sectors in 2012 are completed by finance (15%), entertainment & media (13%), retail (12%) and technology (9%).
In comparison, across mobile display only, entertainment & media are the top spenders (accounting for 16% of mobile display only) followed by consumer goods (13%), retail (12%), finance (12%) and technology (11%).