IAB UK & PwC Adspend Study 2020
The UK affiliate marketing industry was worth £627 million in 2020 and grew 10% according to the annual Digital Adspend Study conducted by the IAB in collaboration with PwC.
Despite the economic challenges posed by the COVID19 pandemic, affiliate marketing delivered higher year-on-year growth in 2020 (10%) compared to 2019 (8.4%), and outgrew the overall UK digital ad industry, which registered 5.2% growth last year.
The size of UK affiliate marketing in 2020
- £627 million was spent on affiliate marketing in 2020
- 10% year-on-year increase
- £258 million was spent in affiliate via smartphones, a 23% increase
- Non-smartphone spend was higher at £369 million, but increased only 3%
What is the size of digital advertising in the UK?
The 2020 Digital Adspend Study published by the IAB found that:
- The UK digital advertising market was worth £16.47 billion in 2020
- The industry grew by £808 million in 2020 for a 5.2% year-on-year increase
- £9.75 billion or 59% of UK ad spend was delivered on smartphones
- Paid Search is the biggest single ad channel, accounting for 51% of total ad spend
- Paid Search grew 7% year-on-year, while Social Display was up 19%
- 33% of all digital ad spend in the UK was billed through agencies
What is the Digital Adspend Study?
Each year, the IAB collaborates with PwC to measure the size of the UK digital ad industry, which includes affiliate marketing. The affiliate marketing study is based on surveys and submitted data from nine affiliate marketing companies, and also models data from retailers like Amazon, eBay and Booking.com. This is the second year that Adtraction has participated.
The wider Digital AdSpend Study into UK digital ad revenues took submissions from 76 media companies, as well as modelled data from the major advertising networks.
What the 2020 Digital Adspend results mean for affiliate marketing
In such a volatile year for the economy, where whole verticals have been at a standstill due to the COVID19 pandemic, registering any kind of growth is a significant achievement. It demonstrates the resilience and scaled distribution of affiliate spend in the UK.
The fact that 2020 showed higher growth than 2019 highlights the major shift towards e-commerce that has occurred during the pandemic. Consumers have increasingly turned to online shopping and businesses have invested more in marketing to capture the increasing volume of online shoppers. Affiliate marketing has undoubtedly benefited from overall e-commerce growth in 2020 and helped to offset the declines in ad spend seen in verticals most significantly affected by COVID19 lockdowns, such as travel.
Delivering a growth rate almost double the general growth of digital ad spend in the UK points to the strength and popularity of affiliate marketing as a profitable channel, with a transactional-based marketing model which advertisers can turn to in times of uncertainty as a low-risk way of advertising online.