The European digital advertising market has grown by 11.1% to an all-time market high of £81.7 billion, according to IAB Europe’s AdEX Benchmark report for 2023.
This promising growth marks cause for significant optimism on the European digital advertising market, which has been buffeted by considerable economic and geopolitical issues across the last 12 months.
Compiling data from 29 national markets, the IAB’s report shows that Europe’s digital ad market is growing faster than the US, which only grew by 7.3% in 2023 despite being 2.5 times the size.
Digital ad spend was not spread evenly across the continent however, with the bulk of it being concentrated in the primary markets of the UK, Germany, France, Spain, and Italy – which between them accounted for 69% of total spend.
In spite of this of this imbalance, most European markets did demonstrate robust growth overall. Some 13 saw growth in the double figures, including nine central and eastern nations which grew above the continental average of 11.1%.
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Turkey, Serbia, and Ukraine experienced particularly impressive growth (of 50%, 27.6% and 25.2% respectively), although the former’s can be largely attributed to inflation.
“Digital advertising defied all odds in 2023 and grew by 11.1%. This can be attributed to interest rates improving, and the economy stabilising, giving advertisers greater confidence once more,” IAB Europe’s chief economist, Dr Daniel Knapp said.
“While many remained cautious, we saw an increased recognition for more sustained spending, as brands looked to build presence back up and maintain a share of voice in the market. This period also saw a return of new companies and SMEs entering the market.
“As businesses have transformed to become increasingly more digital, advertising has evolved from a siloed function to a more integral part of the overall marketing strategy, helping to fuel 2023 growth.”
The top performing digital format was audio, which was considerably amplified by podcasts growing at 32.5%, followed by CTV at 23.5%, total display at 20.9% and social ads at 18.9%.
Programmatic still accounts for as much as 51.9% of total display, although the market is showing increasing maturity. This is driven by the increasing allocation of budgets to new and evolving channels such as CTV and retail media, alongside the development of solutions to counter the end of third-party cookies.