The media industry’s future is looking less than rosy following Brexit, with analysts warning of a decline in advertising across the board due to the negative impact on the UK economy.
In a report compiled by Enders Analysis, the research company said the immediate impact of Brexit is likely to be an advertising decline and raised concerns for the UK’s creative economy, whose funding is largely a result of the UK’s membership of the single market and the benefits this offered in terms of access to EU member states.
Enders also called 2016 a “wretched” year for UK news publishers and predicted a 15 per cent decline of print display advertising, a figure the company assumes will be replicated in 2017.
“The long term future of publishers will clearly be dependent on their ability to build sustainable digital brands, but the current reality is that as print still accounts for 88 per cent of news publishing revenue, they are caught in a difficult balancing act; having to pump resources into capital intensive, low return digital outfits while managing the decline of a form that provides the lion’s share of revenue and the cash needed to invest further in digital,” read the report.
Enders also forecasts that UK digital advertising will grow beyond £10bn by 2018, to represent more than half of all advertising spend, which will mean the UK will have the most advanced large advertising market in the world on a per capita basis. However, issues such as ad blocking and different attitudes between brands and agencies regarding the digital marketing marketplace could spell trouble if not addressed.
The TV industry is faring better, with stable headwinds when it comes to television viewing, with certain genres seeing an uptick in viewing. The report said that as the core viewing age of linear TV rises there is an opportunity for broadcasters to “leverage this trend” to make the most desirable schedule for their available audience.