Nearly half of advertising money in Iceland in 2022 went to foreign media. Total payments to the media for display of advertisements was 25 billion ISK, thereof 11.5 billion ISK were paid to foreign media, or 46%, and 13.8 billion ISK to domestic media, or 54%. Advertising expenditure has increased by 10% since the recission following the Covid-19 pandemic. Advertising expenditure in 2022 was comparable with in the next years before the banking crisis in autumn 2008.
In recent years, advertisement payments to foreign media have increased near continuously. Estimated volume of payments for advertisements in foreign media, almost entirely on the web and online, has more than doubled in less than a decade, from 5 billion ISK in 2013 to 11.5 billion ISK in 2022 in fixed prices. Share of individual media companies of the total expenditure is not known, but credit cards payments to foreign companies for advertisement services and related activities, which amount to half of the total advertising payments to actors abroad, reveal that in recent years Facebook and Google retain 95% of the credit card transactions only.
In 2022, advertising revenue of the domestic media increased from the previous year by 6%, or from 12.3 billion ISK to 13.8 billion. Over the same time, payments to foreign media increased by 14%. The advertising revenue of the domestic media is now comparable with what it was in the years 2011-2015. Overview of the trend of advertising revenue of the domestic media in the years 1996-2022 is depicted in the graph below, shown as indexes in current and fixed prices.
Nearly 30% of payments for advertisements in the domestic media in 2022 went to daily and weekly newspapers, which are the single largest advertising medium in Iceland. Second most important was the web media (20%), then television and radio, with 19 and 18% share, respectively. It is noteworthy that the share of outdoor advertising has increased significantly over recent years, holding 11% share in 2022 compared with 3% five years ago.
Since 1996, the division of the advertising revenue share between different kinds of media has changed, largely at the expense of dailies and weeklies whose share has lowered from nearly 60% down to 24% of the total. This can be explained by two interrelated factors. On one hand to the advent and increased importance of the web media and, on the other hand to general downturn in circulation and reading of newspapers, followed by closures of newspapers.
To begin with the weight of the web media as an advertising medium was limited. Since in the 2010s, the importance of the web as an advertisement medium has increased slowly but surely. Today the web retains 20% of the total advertising revenue of the domestic media. Nearly 90% the advertising revenue online goes to web sites of other media.
The Icelandic advertising market displays some traits compared with widely elsewhere as can be seen in the table below, which indicates the shares of single medium of the advertising cake, calculated form added domestic and foreign payments.
Newspapers and radio in Iceland capture generally higher share of the advertisement revenue of the media than elsewhere. The share of other media is more or less comparable to the comparison countries and world-wide, according to estimates.
About the data
Information about advertising revenue of the media are derived from annual accounts and according to information from The Icelandic Media Commission from 2011. In the instances when information is lacking from media operators the advertising revenues are estimated from VAT tax reports. Hence, it must be kept in mind that the figures are partly based on estimates. The data do not include catalogues and directories, direct marketing, and direct and multiple mail, or advertising on non-domestic web sites. Sponsoring is included.
Information about payments to foreign media are derived from the databases of payments for import of services and credit cards payments for services.