Surging Facebook drives UK online display growth

For a decade now online display advertising has been the poor relation of search (mainly Google) but now in the UK display is growing far faster than search, 27.5 per cent up in 2010 compared to eight per cent for search.

And driving the growth is Facebook, which now has 30m users in the UK.

According to internet Advertising Bureau figures advertising on social media sites (chiefly Facebook) increased by 200 per cent in 2010 to take five per cent of the overall online market, estimated at £4.1bn or 25 per cent of total UK advertising.

At its current rate of growth advertising on social media (aka Facebook) is forecast to overtake Google’s share of online display advertising by the end of 2011.

Facebook is supporting the trend with the launch of Facebook Studio, a sharing site for agency creatives, aimed at increasing awareness of the site’s creative potential. But the world’s big brands are already committing huge sums to Facebook, conscious of the huge possibilities of brand recommendations from Facebook brand fans.

The trend has also sparked a rapidly-growing industry of social media specialist agencies. Omnicom recently paid $100m for Boston-based specialist Communispace.

Across the UK market as a whole advertising increased by 6.9 per cent in 2010 to reach £15.5bn according to Advertising Association figures with television leading the way among traditional media with a 15.8 per cent increase on 2009. However the AA says growth will moderate in 2011 to 2.9 per cent.

The reality is that no-one really knows. Facebook’s growth has surprised many commentators, some of whom doubted that the site would ever be used in a major way by big advertisers.

And mobile advertising doubled in the UK in 2010 to hit £83m, at this stage a tiny fraction of the total but one which is set to soar as Apple’s new iPad (which appears to be the ultimate recession-proof product) and other tablet computers drive growth.

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About Angie Dean