UK Ad Spend Reaches £46.7bn. The Reclassification Underneath Matters More
The annual UK ad spend benchmark just got its biggest structural overhaul in years
The Advertising Association and WARC have published their annual Expenditure Report, and the most consequential thing in it is not the £46.7 billion headline figure for 2025 (up 6.4% year-on-year). It is a reclassification that reframes what every previous dataset was measuring.
For the first time, retail media and social media are being reported as standalone channels. They had previously been absorbed into broader categories, making it difficult to track their true scale. Pulling them out changes the comparability of every channel total in the report.
What “Other Online Display” tells you
“Other Online Display” fell 20% in 2025 and is forecast to drop a further 25% in 2026. That category, which includes audio, gaming, video outstream, native advertising, and display embedded formats, now explicitly excludes revenues from social, retail media, TV, radio, and news and magazine brands. Strip those out and what remains is a contracting residual.
The same logic applies to search. Retail media has now been separated from the search total, which means the £17.9 billion attributed to search in 2025 is not directly comparable to previous years’ figures. Search still accounts for the largest share of UK advertising investment at 38.3%, but that number has been quietly recalibrated.
The channels growing quickly
Retail media recorded full-year growth of 17.5% to reach £3.75 billion, and its Q4 performance was particularly sharp, up 30.5% year-on-year during the festive season. That tracks the US trajectory, where retail platforms now compete with traditional media owners for brand budgets, not just performance spend.
Addressable TV grew 37% across the year to £1.84 billion, though total TV revenue declined 1.2% when linear is included. Addressable is taking share inside a shrinking total, buyers are reallocating within TV before they reallocate away from it.
Social media (including YouTube) grew 21% to £11.5 billion, 24.7% of all UK advertising investment, a larger share than TV and published media combined.
Where the money is leaving
Published media (national and regional newspapers and magazines, print and digital) declined 5.1% in 2025, with regional news brands falling 6%. Even online revenues within regional titles dropped 2.2%. National news brands fared slightly better, with online revenues down just 0.9%, but the overall picture for print-heritage publishers is one of structural decline. Direct mail was broadly flat, down 0.3%.
What comes next
The AA and WARC describe this as phase one of a broader update programme. Phase two will address three areas:
How investment in the influencer and creator channel is captured
How to categorise spend in the emerging generative AI and LLM advertising channel
How to distinguish between the investment patterns of large brand advertisers and the estimated 3.5 million UK SMEs that advertise annually.
Stephen Woodford, Chief Executive of the Advertising Association, framed the refresh as a response to a more fragmented market: “This evolution of the AA/WARC Expenditure Report will ensure the industry has the best possible information to guide understanding of investment across the UK advertising and media landscape.”
The LLM channel question is worth watching. At present there is no agreed methodology for measuring what brands spend on AI-native placements sponsored outputs in chatbot responses, model-embedded brand integrations, and similar. Without a standard, AI-native placements stay invisible in benchmarks like this one, even if the underlying spend is already material.
For more information visit www.warc.com/expenditurereport
