Video display and digital retail media outpaced wider digital ad market growth in 2024, IAB UK’s latest Digital Adspend Study, conducted in partnership with MediaSense, found.
According to the IAB, the UK digital ad market grew 13% last year to exceed £35.5bn.
Video display — including social media, publishers, outstream, advertiser-funded VOD and broadcaster VOD — grew 20% to £8.28bn.
Its share of the display segment has now grown to 64%, up from 51% five years ago. The total display category was worth £12.98bn in 2024.
The IAB attributed this performance to the general shift in audience behaviour, citing GWI research that found under-55s now spend more hours per week watching digital video than linear TV.
Within video display, mobile formats continue to attract the largest share of investment, up 20% to £6.1bn — but it is worth noting that connected TV grew at a stronger rate for the first time, at 22%.
Wider market outlook
Meanwhile, digital retail media grew at an even faster pace, albeit from a much smaller base. This segment rose 23% in 2024 to £1.42bn to account for 4% of the digital ad market — the same proportion as in 2023.
Looking at the digital ad market as a whole, despite the strong growth in display and digital retail media, search maintained its dominant position.
Search was responsible for 47% of the market in 2024, up 13% from 2023, to reach £16.6bn.
Display, on the other hand, accounted for 37% (with video display within this responsible for 23%). Both classified and digital OOH had a 3% share each, with the remaining 7% categorised as “other”, which spans formats such as gaming, podcasts and solus emails.
Digital OOH grew by 10% year on year, but growth has slowed from 2023.
In particular, the IAB pointed out strong growth in gaming as audience continue to diversify, with Ipsos Iris data showing more women than men are now playing across mobile, tablet and laptops.
The gaming ad market rose 9% to £1.11bn last year.
Meanwhile, the IAB noted that the top five companies outpaced the overall market, growing by 15% to account for 74% of it, driven by their video and display offerings.
Macroeconomic headwinds
The overall market grew by 13% in both H1 and H2 — suggesting that the autumn budget did not make an immediate impact on advertisers’ confidence, the IAB said. This is despite the IPA’s Q4 2024 Bellwether Report indicating marketers were reducing media investment amid cost-related concerns spurred on by the budget.
The IAB now forecasts the 2025 digital ad market to be valued at £38bn, with growth slowing to 7%. It also further cautioned growth may be impacted by prolonged economic uncertainty amid the introduction of trade tariffs by the US.
In fact, the latest Q1 Bellwether already found that companies already began adopting a cautious, short-termist approach even before US President Donald Trump announced (and later partially “paused”) sweeping global tariffs.
Looking further ahead, the IAB anticipates the 2027 digital ad market to be worth $42.4bn, up 5%, with video display expected to account for 27% of the market.
Search is expected to lose share by just one percentage point to still take the biggest share of the market at 46%.
In a comment, IAB UK CEO Jon Mew highlighted the way in which consumers becoming increasingly “video-centric” has influenced advertiser budgets.
“Digital video ads give brands the creative canvas to create brilliant content themselves and deliver those essential brand-building moments,” he said.
“We expect to see advertisers’ shift to video accelerate over the coming years as new technology diversifies our screen choices and barriers between different media channels continue to erode.”
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