CTV spending increased in the UK last year, according to the most recent IAB Digital Adspend report, as advertisers seek to invest in cookieless environments.
The analysis, conducted in collaboration with PwC, discovered that ad expenditure on CTV devices (£1.2 million) increased by 21 percent year on year, contributing for 17 percent of total video spend in 2023.
According to the research, the UK digital ad industry rose by 11 percent year on year, reaching £29.6 billion in 2023. According to the research, the growth rate outpaces GDP by 0.1 percent, indicating advertisers’ desire to capitalise on rising involvement in online entertainment and its associated digital ad forms.
Just behind podcasts (+23 percent) and CTV, social video ad spend increased by 20% year on year, with all three categories beating the overall digital ad market. According to the IAB and PwC, this implies that ad expenditure “is following consumer behaviour,” with 28% of the population reporting an increase in their use of ad-supported online entertainment during the cost-of-living crisis.
However, the analysis says that the rise in podcast, CTV, and social video advertising is due not only to the channels’ increasing popularity, but also to their relative resilience to the upcoming elimination of third-party cookies in Chrome, making them a safer investment for marketers.
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“With the impending deprecation of third-party cookies, digital advertising is undergoing a shift and we know that the year ahead will reshape the industry in new ways,” said James Chandler, CMO of the International Advertising Bureau (IAB). “In that context, it’s encouraging to see advertisers seeking out engaged environments and increasingly investing in a broad array of online solutions.”
Targeted investment
Indeed, a loss of targeting capabilities can have a significant impact on digital advertising spending. According to the analysis, Apple’s privacy reforms will limit mobile ad spend growth to 4% in 2022. However, mobile publishers appear to have restored advertiser confidence last year, as mobile spending increased 15% to £16.7 billion.
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The sustained expansion of digital retail media spending (£283 million), which increased by 12% last year, demonstrates the relevance of first-party data following the removal of third-party cookies. Meanwhile, digital out-of-home expenditure increased 12 percent to £841 million. Display and video revenue also increased by 12% to £11.3 billion, with video accounting for 60%. However, search continues to account for half of overall digital ad spend, which is expected to reach £14.7 billion in 2023.
“As well as providing us with invaluable insight on the health of the digital ad market as a whole, the latest Digital Adspend results show how advertisers are embracing the diverse array of digital channels on offer,” the head of the IAB UK, James Chandler, stated. “Media that are often referred to as ’emerging’ are taking their place as increasingly established ways to resonate with engaged audiences – whether that’s via the immersive nature of podcasts or high-impact fame factor of CTV.”
“Digital media continues to evolve, demonstrating adaptability and resilience,” said Stephanie Claxton, Senior Manager at PwC. “Growth was not only seen from emerging channels including digital out-of-home, which was included in the report for the first time, and retail media, which weathered the economic headwinds to deliver double-digit growth online; but also established channels including mobile where ad spend increased and search, which maintained its dominant market share.”
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