UK luxury advertising market boosted by Brexit vote, weak pound and tourism

 
William Turvill
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Luxury adspend is expected to grow 3.2 per cent in the UK this year and 2.9 per cent globally (Source: Getty)

Spending on luxury advertising is set to jump by 3.2 per cent in the UK this year, apparently boosted by last year’s Brexit vote.

The growth, in line with 2016’s performance and driven by advertisers targeting online platforms, will see luxury spend total $609m (£484m).

Zenith’s Luxury Advertising Expenditure Forecasts report expects growth to then slow to 2.5 per cent in 2018.

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“Brexit has led to a huge boost in luxury sales,” the report said. “The UK is reportedly the cheapest market in the world to buy luxury goods following the drop of the British pound.

“The UK has experienced a dramatic rise in ‘luxury tourism’ as a result of this. Given that international clientele account for 50 per cent of the sales of some luxury brands, this has provided a strong boost over the past quarter.”

It added: “However, this may be a temporary boost as luxury brands scramble to adjust their prices and time eases tourists’ nervousness about travelling to mainland Europe.

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“The downturn in Chinese tourists and instability in the Middle East remains a significant concern. 2017 could be a challenging year given the reliance on international clientele.”

Globally, luxury adspend is expected to rise 2.9 per cent, following a 0.5 per cent contraction in 2016.