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UK advertisers spend over £800m on Online Performance Marketing

News | British advertisers | ROI | IAB

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British advertisers spent more than £800 million on Online Performance Marketing last year, a new study has found.

These activities included affiliate marketing and lead generation, generating £9 billion in sales, with this spending mainly driven by finance and retail advertisers.

This is according to the UK's first ever study on the Online Performance Marketing (OPM) industry, which was conducted by Pricewaterhousecoopers (PwC) on behalf of the Internet Advertising Bureau (IAB).

During 2012, British consumers carried out around 100 million direct transactions as a result of affiliate marketing, reaching a total value of £8 billion, while 70 million enquiries were also submitted, resulting in £1 billion of lead-generated sales.

These figures show that OPM drives roughly five to six per cent of all UK e-commerce retail sales.

Retailers are the next biggest spenders, accounting for 20 per cent of OPM expenditure, with telecoms and media (ten per cent), travel and leisure (nine per cent) and gaming (six per cent) making up the top five.

It is predicted that, between 2008 and 2012, advertising expenditure on OPM grew by 57 per cent as a result of lead generation spend rising by 136 per cent. Affiliate marketing spend also jumped by 50 per cent over the four years.

As well as this, suppliers of OPM services and technology estimate their revenue will rise by 25 per cent this year, thanks to a combination of market share gain and market growth.

On the other hand, advertisers believe they will spend five to ten per cent more on OPM in 2013.

Tim Elkington, director of research and strategy at the Internet Advertising Bureau (IAB), said: "Despite around 3,500 advertisers and 10,000 publishers engaging in Online Performance Marketing it still has the air of a ‘best-kept secret’.

"This is particularly surprising, considering each year it drives more than two online purchases for every UK adult and causes the equivalent of every UK person to fill out a form showing interest in a product – generating £11 of revenue for every £1 spent."


Posted by Jon Aspinell on 23rd January 2013

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