This week, in conjunction with PwC, the IAB UK released its annual Digital AdSpend Study, measuring the size of the digital advertising market in the UK. Partnerize was once again happy to contribute our own figures to the study to help give an accurate representation of the affiliate channel and its contributions to the wider digital advertising industry. With that in mind, we wanted to take a look at some of the results and what this means specifically for performance marketing in the UK.
For the purpose of the study, affiliate is listed under the broad category of display advertising. However, it is important to note that this media format incorporates separate channels that are not necessarily linked to performance, like standard display advertising and email display ads. It also covers areas such as paid sponsored content which, we are finding, frequently sits within the remit of partnership teams for an increasing number of brands. Therefore it is safe to assume that the performance channel is actually substantially larger than the broken down figures show.
Nonetheless, according to the study, ad spend hit £15.69bn in 2019, an increase of 15.4% from 2018. Affiliate marketing accounted for £510 million of this, having had another year of consistent growth, up 8.4% YoY. Consumer goods, retail, and computers and software were the biggest contributors to overall ad spend growth. Those sectors were closely followed by automotive, clothing and fashion accessories, and financial services including insurance. These stats mirrored what we see as some of the largest growth areas for the affiliate industry, but interestingly travel ranked 6th on the list.
The study found that spend on smartphone advertising has continued to increase, and is now 70% of the total budget for display. In 2013, the figure was only 23%, so it is clear that this trend has been on a rapid upward trajectory and according to our own research these growth trends in Britain are consistent with those of every other market as well.
Data shows shoppers now integrate their mobile devices across every phase of the buying journey. Given the magnitude of uplift we see reported in this study, it becomes more critical than ever to incorporate mobile into attribution and measurement strategies.
The performance industry is uniquely positioned to deliver accurate, data-driven insights that measure revenue, transactions, and marketing events across channels. It is unparalleled in providing not only ROAS but also actionable intelligence which can be applied across the digital marketing landscape.
Interestingly, the study details that video is the largest display ad format, growing from 34% of total in 2018 to 38% in 2019. We expect to see more video activity in affiliate. Traditional affiliate advertising formats will likely diversify to incorporate video content, particularly outstream which accounts for 62% of all video spend and is growing by £400 million YoY.
On the topic of navigating from traditional display advertising, we are now seeing social ad spend increasing exponentially by 25% YoY to revenue of £3.59bn in 2019. Again this spend was primarily focused on smartphones, with 74% of display appearing on smartphones.
You can view the full study here.