An ongoing shift to streaming among audiences, new ad-based models from the likes of Disney+ and Netflix, and an increase in ad-supported viewing as people look to cut down on subscriptions are set to drive further growth in the UK Connected TV (CTV) market, with ad spend forecast to rise from £1.17 billion in 2021 to £2.31 billion in 2026, according to UK digital advertising trade body the IAB’s latest report.
In fact, ad spend has grown an average of 40% annually since 2017. In 2021, around 48% of CTV spend was on broadcaster video-on-demand (BVOD) and 50% on other ad-supported streaming services. Among all players, YouTube is one of the big winners in advertising-based video-on-demand (AVOD).
The report, created with research consultancy MTM, shows that adoption of CTV by large advertisers is now close to that of linear TV and digital video and – with a low minimum spend compared to television – CTV is attracting a broader set of advertisers. However, the IAB notes that the CTV market “needs to address challenges with fragmentation, standardization and measurement – particularly beyond BVOD and YouTube – in order to fully mature.”
Furthermore, according to the study, 66% of UK households now use CTV devices. Therefore, CTV viewing is also on the rise, accounting for some 28% of all TV viewing by UK adults. For 16-34-year-olds, the number rises to 55%. The uptake of CTV devices jumped from one-third of UK households in 2017 to two-thirds by 2021.
Meanwhile, gaming is another market on the rise. Growth in gaming ad spend is being driven by the evolution of ad solutions such as native in-game ad formats and programmatic buying – as well as the adoption of gaming by advertisers across a broader range of sectors, from financial services to healthcare. Current annual spend of £815 million is predicted to rise to £1.84 billion by 2026.
Related News
