09/03/26 // Digital Media
UK Advertising Spend 2026: The Complete Channel-by-Channel Breakdown
Written by: Simon
According to the latest Advertising Association and WARC forecast, UK ad spend is expected to pass £50 billion in 2026. Total market size matters, but the channel split is where the planning decisions actually live.
Here is the full picture by channel, based on the most recent data from IAB UK, AA/WARC, Thinkbox, and Route.
How Big Is the UK Advertising Market in 2026?
Total UK advertising expenditure reached £46.9 billion in 2025, up 10.1% year-on-year per the AA/WARC Expenditure Report. That followed a 10.4% rise in 2024. The 2026 forecast of 7.5% growth is slightly softer, revised down somewhat to account for trade headwinds and a tougher economic backdrop, though the direction of travel has not changed.
Digital formats now account for around 86% of total UK spend. The IAB UK Digital Adspend Report puts the digital market at £40.5 billion in 2025, with a further £44.7 billion forecast for 2026.
| Year | Total UK Ad Spend | YoY Growth | Digital Share |
|---|---|---|---|
| 2023 | £38.6bn | n/a | ~78% |
| 2024 | £42.6bn | +10.4% | ~80% |
| 2025 | £46.9bn | +10.1% | ~86% |
| 2026 (forecast) | £50bn+ | +7.5% | ~89% |
Sources: Advertising Association/WARC Expenditure Report (January 2026), IAB UK Digital Adspend 2025
UK Ad Spend by Channel
Search
Search accounts for 44% of all digital ad spend and remains the largest single channel in the UK. Investment reached £17.9 billion in 2025, growing 6% year-on-year per IAB UK, with a further 10.2% forecast for 2026.
Google holds a 92.57% share of UK search. Average CPCs across most UK industries sit between £0.75 and £1.50, though finance, legal, and insurance push well beyond that. CPC inflation has been the dominant operational challenge for brands running paid search, and we covered the mechanics behind it in our piece on why Google Ads CPCs are rising. The short version: more advertisers, smarter automated bidding, and reduced auction transparency.
Performance Max continues to absorb an increasing share of search budgets. That creates measurement complexity, and brands without clear incrementality frameworks are likely overpaying.
Social Media
Social media advertising grew faster than any other major channel in 2025. Spend reached £11.5 billion, up 21% year-on-year, and now represents 28% of the total digital market according to IAB UK. Video is the main driver, accounting for 59% of all social media ad investment.
Platform performance is mixed. Facebook reach rose 51% among its 38.3 million UK users, and Instagram remains the highest-ROI platform for product-based businesses, with 44% of marketers citing it as their top performer. TikTok’s picture is more complicated: despite reaching 26.8 million UK adults, engagement fell in 2025, with reach down 19% and interactions down 32%. Audience size and engagement are moving in different directions, which matters for how you buy.
For B2B, LinkedIn shows a 23% uplift in qualified leads for brands running paid activity there, which remains well above what most other platforms deliver in that context.
Video and Connected TV
Video advertising investment grew 20% to £9.3 billion in 2025, making it the fastest-growing format by spend volume. It now accounts for 23% of total digital investment, with broadcaster and streaming TV formats making up 34% of all video spend.
CTV is where the change in buyer behaviour is most visible. Spend grew 21% in 2025 and is forecast to rise 15% in 2026. The UK CTV market is expected to reach £2.31 billion this year, up from £1.17 billion in 2021, per IAB UK. One data point that illustrates how quickly agency buying behaviour is changing: the proportion of agencies planning to buy YouTube on TV screens went from 23% to 85% between 2025 and 2026.
Measurement remains the constraint. Over half of marketing decision-makers say they would increase CTV investment with better ROI measurement. Cross-screen attribution is still not solved, and that limits how confidently budgets move.
Television (Linear and VOD)
Total TV advertising spend held at £5.3 billion in 2025, though the composition shifted. Linear TV declined roughly 5% per quarter as audiences continued moving to streaming. VOD, including broadcaster platforms and ad-supported streaming tiers from Netflix, Disney+, and Amazon, grew to partially offset that.
By the end of 2026, VOD is expected to account for 32% of all TV spend. The near-term outlook is supported by the FIFA World Cup, which historically lifts TV investment in Q2 and Q3.
On effectiveness, Thinkbox’s Profit Ability 2 study found TV accounts for 54.7% of all advertising-generated profit across channels, with an average return of £5.61 per £1 spent. Linear TV specifically delivers £1.82 in short-term payback and £5.94 in long-term payback per pound invested. They are worth having to hand when reach decline gets raised as a reason to reduce TV budget.
The Less Healthy Food regulations, which came into force in January 2026, ban LHF ads before 9pm on linear TV and regulated VOD. BVOD sits outside the digital restrictions that apply to other video platforms, which changes the relative value of broadcaster inventory for affected categories.
Retail Media
Retail media reached £3.8 billion in 2025, up 18% year-on-year per IAB UK. In H1 2025 alone, online retail media accounted for £1.5 billion. It has grown consistently for six years, from £1.32 billion in 2019 to a projected £7.88 billion in 2026. That is not cyclical.
For ecommerce brands, the attraction is straightforward: better first-party data, tighter measurement, and proximity to sale. Retail media sits at the bottom of the funnel where attribution is cleaner, which makes it easier to defend in budget conversations. The challenge is that as more brands pile in, the pricing dynamics will start to look more like paid search, with CPMs rising as competition increases.
Out of Home
UK out-of-home advertising reached £1.44 billion in 2025, a record according to Route and PwC. Digital OOH now accounts for 67% of all OOH revenue, up from 32% in 2015, and is forecast to reach 75% of revenue by 2027.
Programmatic DOOH is still early, around 5% of OOH spend, but forecast to reach 16% by 2027 as more inventory becomes accessible through automated buying. OOH delivers an average return of £1.60 per pound spent and 79% ad recall within a month, per Route research. It tends to be underweighted relative to its effectiveness profile, partly because it is harder to measure in a like-for-like way with digital channels.
Influencer Marketing
UK influencer investment reached £930 million in 2024, a 13.6% increase year-on-year per IAB UK and Kolsquare, and is expected to cross £1 billion through 2025. The UK is the largest influencer market in Europe, and 93% of UK marketers now work with micro-influencers, well above the European average.
Half of UK brands plan to increase influencer spend in 2025. The move toward nano and micro-influencers reflects tighter scrutiny of engagement quality over raw reach, which is the right direction for performance-focused briefs.
Programmatic and AI
Programmatic now accounts for 78% of all digital display spend in the UK, per IAB UK. It is infrastructure at this point rather than a differentiator. The question for most planning teams is not whether to buy programmatically, but how to manage transparency, brand safety, and frequency across an increasingly fragmented environment.
AI is changing the buying process faster than the strategy that sits behind it. UK AI marketing investment grew 47% year-on-year in 2025, and the efficiency case is real: AI-driven bid management is cutting wasted spend and improving measured ROI. But 56% of senior industry leaders in IAB UK research cite over-reliance on automation as a top-three concern.
The reason is straightforward. Algorithms optimise for what platforms can measure, which tends to mean bottom-funnel signals. Over time, that pulls budget away from the brand activity that makes the bottom of the funnel work. It is a slow problem, which is why it tends not to get fixed until it is obvious.
2026 Channel Forecasts
| Channel | 2026 Forecast Growth | Key Driver |
|---|---|---|
| CTV | +15% | Audience migration, new ad inventory |
| TV VOD | +13.8% | World Cup, AVOD/SVOD expansion |
| Search | +10.2% | AI bidding, Performance Max |
| Online Display | +8.4% | Programmatic maturity, video display |
| Online Radio | +7.3% | Shift to digital listening |
| Total TV | +5.8% | World Cup uplift, LHF reallocation |
| Retail Media | Double-digit | First-party data, closed-loop measurement |
| OOH | Positive | DOOH inventory growth |
Sources: AA/WARC, IAB UK, Guideline
57% of advertisers expect their digital budgets to increase in 2026, per IAB UK. The channels forecast for the strongest growth are also the ones with the most pressing measurement challenges. CTV, retail media, and DOOH are all growing fast partly because inventory is expanding, and partly because buyers are still learning how to evaluate them properly.
Planning Implications for 2026
A few things stand out when you look at the full channel picture together.
Video is becoming harder to treat as optional in a modern media plan. It is now the dominant format within social, the growth story within TV, and the main driver behind CTV. Brands without a clear video strategy across platforms are not just missing reach, they are increasingly out of step with how audiences consume content.
Retail media warrants serious attention for any brand selling through online retailers. The measurement is closer to closed-loop than almost any other channel, which makes budget justification straightforward. The risk, as with any maturing channel, is that entry costs rise as more brands compete for the same inventory.
The linear TV decline is real, but it does not translate directly to TV being less useful. Total TV investment is holding above £5 billion. The definition of what counts as TV has expanded to include BVOD, ad-supported streaming, and CTV. Effectiveness data from Thinkbox still puts TV ahead of every other medium for profit generation. The planning question is not whether to be on TV, but which delivery format makes sense at your budget level.
Most of the movement in 2026 is not about whether a channel matters. It is about how its role is changing, how it should be measured, and whether your budget model has kept up. The channels growing fastest are often the ones where measurement is least mature, which creates real risk for brands that follow spend trends without building the evaluation framework alongside them.
If you are reviewing your channel mix or want to pressure-test how your allocation compares to these benchmarks, we are happy to take a look.
Sources
- IAB UK Digital Adspend 2025 (with Oliver Wyman)
- Advertising Association/WARC Expenditure Report (January 2026)
- Thinkbox, Profit Ability 2
- We Are Social, Digital 2025: The United Kingdom
- Route Media and PwC, OOH Revenue Data 2025
- IAB UK and Kolsquare, State of Influencer Marketing UK and Europe 2025
- Statista, UK Digital Retail Media Spend Forecast
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