Member Article

UK entertainment and media market could be worth £64 billion by 2018

Internet advertising, internet access, video games and TV advertising are set to growth the UK entertainment and media market to an estimated value of £64 billion by 2018.

Research from PwC indicates the sector market is expected to grow by 3.1% compounded annually between 2013 and 2018.

Total spend on digital, other than internet access, is forecast to grow at a 10.9% compound annual growth rate between now and 2018 - and will account for 34% of the UK’s entertainement and media spending growth.

The UK is Europe’s largest internet advertising market and become the world’s third highest-grossing internet advertising market in 2012, overtaking Japan to sit behind the US and China.

Paid search dominates the sector in the UK, and PwC estimate this will continue with revenues set to top £4 billion in 2018.

Bill MacLeod, senior partner at PwC in Newcastle, said: “London is widely considered the digital advertising capital of Europe, and linguistic similarities mean that the UK tends to be the first port of call for US publishers and ad tech players entering the European market. All of this adds up to a vibrant, and still growing, internet advertising sector.

“The fact that the English language is the most-used online language is also likely to be a factor in the strength of the UK’s paid search internet advertising market.”

Elsewhere, the UK Video games market is expected to reach £4.1 billion in 2018 - by which point total console games revenue will be £2.1 billion - 51% of total video games revenue.

TV advertising in the UK is expected to reach £4.3 billion in 2013 while the film entertainement sector is estimated to rise in value to £4.6 billion.

On the e-book market, PwC suggest it will account for 41% of all book revenue by 2018, and consumer e-books are forecast to overtake print copies by the same point.

Bill MacLeod added: “Forget audience fragmentation. From a consumer’s angle, it’s about ubiquity - a consistent feel across multiple devices. Building this relationship offers a global opportunity as the economy moves from the delivery of products and services to the delivery of outcomes and experiences.

“The entertainment and media industry is at the forefront of the digital revolution, because so many of its products and services can already be delivered in digital form. It may not be long before digital revenues from print, film, publishing and music overtake physical revenues in some markets.

“Media companies don’t need a digital strategy anymore; they need a business strategy, and a business model, which is fit for the digital age.”

Rakhee Jogia, director of Display, Rakuten Marketing, added: “Spend across digital channels is increasing as marketers seek more accountable marketing methods and people turn to connected devices. In order to engage with consumers today, brands need to provide an experience with their advertising, offering something truly beneficial to customers.

“It’s absolutely critical to create a functionality for consumers so that they can take action from your ad. You can immediately add more value to your campaign when your banners become interactive or when your product image or information is dynamic.

“Brands need to work with a new mantra for these formats: ‘dynamic, targeted and actionable’ - this is the only way to drive sales in today’s connected world.”

This was posted in Bdaily's Members' News section by Tom Keighley .