Retail Platform Advertising - United Kingdom

In the United Kingdom, ad spending in the Retail Platform Advertising market market is projected to reach US$4.54bn in 2024.
This ad spending is anticipated to exhibit an annual growth rate (CAGR 2024-2030) of 14.29%, which will lead to a projected market volume of US$10.11bn by 2030.
Furthermore, the average ad spending per user in the Retail Platform Advertising market market withUnited_Kingdom is estimated to amount to US$90.14 in 2024.
In a global context, the majority of ad spending will be generated the United States, with a figure of US$57.63bn in 2024.
In the United Kingdom, Retail Platform Advertising is witnessing a shift towards personalized consumer engagement strategies, enhancing brand visibility and customer loyalty.

Definition:

Retail platform advertising (RPA) refers to digital ads displayed on websites and apps dedicated to retail platforms, such as Amazon, Walmart, eBay, Alibaba, and JD.com. This includes all types of advertising across various devices, e.g., PCs, smartphones, and tablets, and covers formats such as sponsored products, banners, and videos. RPA specifically excludes offline retail ads (e.g., in-store displays and billboards), off-site ads (e.g., ads appearing on non-retail websites or apps), ads on social media platforms (e.g., Facebook or Instagram), and ads on search engines (e.g., Google or Bing).

Additional Information:

It is important not to confuse RPA with retail media networks (RMNs). RMNs involve digital ads that are also displayed on retail e-commerce sites or apps, but these ads are purchased through a retailer’s media network or a demand-side platform (DSP). While RMNs include ads on sites such as Amazon and Walmart, they also cover ads bought through networks such as Amazon DSP, Walmart Connect, and Etsy’s Offsite Ads, and these ads may not necessarily appear directly on the retailer’s e-commerce site or app. Unlike RPA, RMNs represent a broader approach that encompasses a range of ad placements, both on and off the retailer’s own platforms.

Digital ads displayed on websites and apps dedicated to retail platforms
All types of advertising across various devices, e.g., PCs, smartphones, and tablets
All types of sponsored ad formats, such as sponsored products, banners, and videos

Offline retail ads (e.g., in-store displays and billboards)
Off-site ads (e.g., ads appearing on non-retail websites or apps)
Ads on social media platforms (e.g., Facebook or Instagram)
Ads on search engines (e.g., Google or Bing)

The Retail Platform Advertising Market in the United Kingdom is witnessing considerable growth, fueled by the surge in e-commerce, enhanced targeting capabilities of digital ads, and the increasing importance of data analytics in shaping consumer engagement strategies.

Customer preferences: Consumers in the United Kingdom are increasingly gravitating towards personalized shopping experiences, prompting a rise in demand for targeted advertisements on retail platforms. This shift reflects a broader desire for tailored recommendations that align with individual preferences and values, particularly among younger demographics who prioritize sustainability and ethical sourcing. Additionally, the growing popularity of social commerce highlights the influence of social media on purchasing decisions, as consumers seek seamless integration between discovery and buying, reshaping traditional retail advertising strategies.

Trends in the market: In the United Kingdom, the Retail Platform Advertising Market is experiencing a surge in the adoption of AI-driven personalization tools, enabling brands to deliver highly relevant ads tailored to individual consumer behavior. Concurrently, there is a notable rise in influencer marketing on retail platforms, where trusted social media figures drive purchasing decisions through authentic recommendations. Additionally, the integration of augmented reality (AR) is reshaping the shopping experience, allowing consumers to visualize products in their environments. These trends underscore the importance of data-driven strategies and consumer engagement, presenting opportunities and challenges for brands and retailers as they navigate a rapidly evolving advertising landscape.

Local special circumstances: In the United Kingdom, the Retail Platform Advertising Market is shaped by a diverse consumer base with varying preferences across regions, leading to localized ad strategies. The cultural importance of sustainability drives brands to highlight eco-friendly products, resonating with environmentally-conscious shoppers. Additionally, strict regulatory frameworks around data privacy, such as GDPR, compel retailers to adopt transparent data practices, influencing how personalized advertising is executed. These factors create a unique landscape that requires brands to balance innovation with compliance, enhancing consumer trust and engagement.

Underlying macroeconomic factors: The Retail Platform Advertising Market in the United Kingdom is significantly influenced by macroeconomic factors, such as consumer spending trends, economic growth rates, and shifts in digital consumption. The overall health of the UK economy, marked by indicators like GDP growth and unemployment rates, directly impacts disposable income and consumer confidence, shaping advertising budgets and strategies. Additionally, inflationary pressures affect both retailers and consumers, prompting a focus on value-driven marketing. International trade dynamics and currency fluctuations further influence advertising costs and competitiveness, compelling brands to adapt their approaches in an increasingly interconnected marketplace.

Data coverage:

Data encompasses enterprises (B2B). Figures are based on Retail platform ad spending and exclude agency commissions, rebates, production costs, and taxes. The market covers advertising by businesses for digital advertisements.

Modeling approach:

Market sizes are determined by a combined top-down and bottom-up approach, based on a specific rationale for each market. As a basis for evaluating markets, we use annual financial reports of the market-leading companies and industry associations, third-party reports, and survey results from our primary research (e.g., Consumer Insights). Next, we use relevant key market indicators and data from country-specific associations, such as GDP, internet users, and digital consumer spending. This data helps us estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the particular market. For example, the S-curve function is well suited to forecast digital products due to the non-linear growth of technology adoption, whereas exponential trend smoothing (ETS) is more suited for projecting steady growth in traditional advertising markets.

Additional notes:

Data is modeled using current exchange rates. The impacts of the COVID-19 pandemic and the Russia-Ukraine war are considered at a country-specific level. The market is updated twice per year. In some cases, the data is updated on an ad-hoc basis (e.g., when new relevant data has been released or significant changes within the market have an impact on the projected development).

This report presents a comprehensive analysis and additional information on the Advertising & Media market, in a PDF format.