The market for addressable TV looks constrained despite its benefits, with Sky AdSmart taking less than 2% of overall TV ad revenues. Meanwhile, online video revenues for Google, Facebook and others have surged dramatically

Agencies are seemingly enraptured by online video – a highly profitable medium to buy – despite concerns about a lack of effectiveness, safety and transparency 

For broadcasters to compete, better radical collaborative action is needed, including industry-wide adoption of AdSmart, and overhauling the trading agreements which hinder its take-up

In this report we develop a rough segmentation of the adult population by level of online use: offline (10% of adults), shallow online (10%), deep online (80%). We examine how online services seeking to reach new audiences increasingly face the obstacle of missing demand rather than a lack of consumer skills or access

The app economy still relies on a limited consumer pool, but ecommerce is now reaching almost all of the deep online. Bridging the current gap between occasional and frequent online buyers is a clear opportunity and we are still in the early days of evolving buying services into shopping services

The only industry monetising all online users is advertising. Ad platforms, led by Google and Facebook, also play a critical role expanding the ranks of the deep online and online immersed. But offline brand display media, led by broadcast TV, remain critical for online brands wanting to expand their audience

UK residential communications market revenue growth fell again to 1.2%, with weakening ARPU growth the main driver. New customer pricing remains flat to down, and existing customers are being increasingly discounted, fuelling the ARPU weakness

High speed broadband adoption is proceeding apace, but the high speed premium is fairly thin, muting the impact on ARPU. Regulated wholesale price cuts from Openreach finalised today and due in April 2018 will not help

Looking forward, the March quarter will benefit from price timing effects at BT and Virgin Media, but we fear that the rest of 2018 will follow the current downward trend and the operators will need to adjust to an ex-growth environment

TalkTalk’s subscriber growth picked up a little in the quarter, but ARPU growth turned back negative, leaving consumer revenue still declining despite the heroic efforts it has made to turn around its subscriber growth in a slowing market

It is expecting even stronger subscriber growth next quarter, but it may need this to maintain ‘headline’ revenue growth given falling ARPU, and the high marketing costs required to achieve this have driven a reduction in EBITDA guidance

The company’s FTTP plans are less dramatic than they first look, with only a £100 million investment commitment over five years. The economics of the build look very challenging, but TalkTalk is minimally exposed to these

We forecast UK display adspend to grow by 3.1% in 2018 (<1% in nominal terms), with TV roughly steady, newspaper decline slowing and digital growth slowing a little

Households are facing an income squeeze and the ability of debt and credit to carry them over is reaching its sensible limit. Brexit-related uncertainties remain the single strongest drag on business investment, dampening ad spend

TV spend is the £5bn question. While live viewing continues to decline, TV delivers against different marketing objectives from precisely targeted online inventory, and rapid broadcaster VOD growth will help hold TV spend steady

Subscription fashion retailer Stitch Fix has gone public, revealing a rare example of a new, private, technology-based company capable of making a profit.

Stitch Fix relies on the ‘mixed intelligence’ of algorithms and human stylists to offer its customers a curated fashion “Fix” of clothing and accessories, aiming to cut through some of the chaos of ecommerce.

Though Stitch Fix’s success is not guaranteed, there is much to be learned from its approach of focusing on building a solid business and generating positive earnings early, rather than growing users at any cost.

A strong UK labour market, with record low unemployment but historically high vacancies, has supported growth in the recruitment industry, though trends may be peaking as we reach unknown territory. These trends play out in the recruitment market before they become apparent in the labour market

Despite the fragmentation of the online recruitment listings marketplace, Indeed is well-placed to dominate this space due to its increased scale and aggressive investment strategy

Both Google and Facebook have announced their intention to move into the recruitment listings sphere, which may have consequences not only for classified expenditure but further up the value chain with the agency model. However, both giants have attempted to move into online classifieds before, with little demonstrable success

The slowing UK economy since Q3 2016 has had a knock-on effect on the property and autos marketplaces underlying UK classified advertising revenues, with house prices slowing, transactions stabilising (instead of rising), and new car registrations down sharply in 2017 to date. Recruitment activity by agencies and employers has instead been dynamic as the UK nears full employment

Advertisers in these verticals continue to switch expenditure from print classifieds to internet portals and search, which offer superior lead generation, analytics, and user experience. Only in property do local newspapers still fulfill an important estate agency branding function for the local area, although declining readership is blunting this value to advertisers

Portal dominance comes at a price to advertisers in property, where Rightmove has resisted agent efforts to lessen dependence by listing on other brands, as well as in used autos, where Auto Trader has long reigned supreme. Recruitment is a more contested market for portals, reflecting the diverse and fragmented nature of the jobs market, but Indeed has a strong grip on the low-end, while LinkedIn remains unchallenged in social recruitment advertising

Print advertising in the autos classifieds marketplace keeps declining, but significant continued online growth steadies the helm

Five years on from new car financing innovations, and exasperated by changes in consumer behaviour towards greener tech, the used car market is braced for a flood

Auto Trader’s competitors force it to keep innovating, although having saturated the market, its dominance gives it enough headroom to worry about the weather breaking

We estimate that UK online ad spend grew by 12.3% this year, with growth concentrated almost exclusively in mobile search and social in-feed advertising (particularly video), and mostly incremental to overall ad spend

Even after payments to publishers and distributors, Google and Facebook captured 80% of all net new spend in the market, and 96% of it flowed through their platforms

Despite improving standardisation and disclosure, the outstanding issues around measurement, the ad-tech supply chain, and particularly the obscure and growing Google/Facebook/Amazon segment, lead us to identify a large portion of digital advertising as a “grey market”: difficult to get a handle on, with uncertain beneficiaries and slippery definitions