The UK has long dominated Western Europe’s ecommerce landscape, accounting for well over half of annual sales in the EU-5. This year, the UK is expected to see $102 billion in B2C ecommerce sales.

But France, Germany, Italy and Spain are increasingly vital markets in their own right. eMarketer estimates that in 2013, combined online sales in these countries will reach $121.5 billion and overtake the UK total for the first time.

“Europe’s ecommerce market is a resounding success by any standard,” said Karin von Abrams, eMarketer senior analyst and author of the new report, “Western Europe B2C Ecommerce.” “The number of online buyers in Europe’s four main continental markets is rising steadily as consumer confidence increases and online sellers provide an ever-wider range of goods and services.”

The complete report is available to eMarketer Total Access clients. Learn more here.

Recent weeks have brought a raft of estimates and forecasts for UK advertising spending in 2010 and 2011. For digital media, the news is excellent; for traditional channels, more sobering.

Spending on internet ads grew 10% in the first half of 2010, the UK’s Internet Advertising Bureau (IAB) declared in October. As reported by MediaTel, online spending came to almost £1.97 billion ($3.09 billion), or 24.3% of all UK advertising during the period.

According to the IAB, online display returned to healthy growth in H1 2010, with spending of £381 million ($598 million)—a rise of 6.4% compared to the first half of 2009. Banner ads accounted for 72% of the display market, or £272 million ($427 million), while pre- and post-roll video ads shot up to £20.7 million ($32.5 million), and display placements on social media sites contributed around £41 million ($64 million).

Display ad impressions (excluding video) rose even more steeply than spending between Q3 2009 and one year later, to judge by figures from comScore Ad Metrix. This suggests that advertisers were getting much better value for their display budgets in 2010, which doubtless encouraged more committed spending.

Classified ads also staged a comeback in 2010, the IAB reported, climbing 11.4% to £379 million ($595 million) during the first half of the year. Paid search marketing rose by 8.9%, to claim 59.9% of all online ad spending, or just over £1,180 million ($1,853 million).

The IAB saw the double-digit rise in online ad spending as part of a more general recovery; by its calculations, total UK ad spending reached £8.1 million ($12.7 million) in H1 2010, 6.3% higher than spending in the first half of 2009.

The Bellwether report, issued by the Institute of Practitioners in Advertising (IPA) and accountancy firm BDO LLP, was less upbeat, noting that the ad budgets of UK marketers rose by an average 0.5% in Q3 2010—a marginal gain, though a welcome contrast to the 4.6% fall registered in Q2.

Like the IAB, the IPA found that the internet delivered the outstanding success stories, with spending on search up 9.9% in Q3 2010, and display spending up 13.3% compared with the previous quarter.

The IPA did point out that most of the 300 or so firms polled for the report were less optimistic about the financial prospects for their industries than in Q2. Moreover, the report’s author ventured that the strong economic performance in Q2 “likely marked the peak of the recovery cycle.”

Looking ahead to 2011, the latest Consensus Forecast from the World Advertising Research Centre (WARC) projected that worldwide ad spending will rise by 4.5%, following a gain of 4.4% in 2010.

Most of that growth will be driven by emerging markets, such as Brazil (where ad spending is predicted to leap 11.4% in 2011), China (13%), India (14%) and Russia (16.3%)

The UK and most other major European countries can expect minor gains by comparison. UK ad spending will rise 2.7% in 2011, said WARC, or just over half the 5% growth anticipated for 2010.

France and Germany will see 2% growth in total ad spending, while Spain will register a gain of 2.2%, after a decline of roughly 1% in 2010.

Globally, WARC foresaw average 2011 increases in Internet ad revenues (13%) far outpacing growth rates in traditional media (5.2% in TV, for example).

The UK, long a leader in internet advertising, will show the lowest growth rates, according to WARC. But even then, online ad spending will be an estimated 6.2% higher in 2011 than in 2010.

Most recently, key companies in the WPP Group, including agencies Ogilvy & Mather and Mindshare, raised their overall forecasts for revenue growth in 2011. According to CEO Sir Martin Sorrell, the revisions were based in part on WPP’s own 4.5% growth between January and October 2010. Group companies had earlier suggested that they anticipated expansion of between 3% and 4% in 2011.

Where does this leave UK ad spending, and online ad spending in particular? Some key aspects to keep in mind:

1. The economic situation remains volatile. In the past week alone, the UK has been buffeted first by news of another national financial bail-out in Ireland (the UK’s number one trading partner) and then by claims that the economy grew by 0.8% in the third quarter, and that spending cuts by the Conservative/ Liberal Democrat coalition government will not have as drastic an effect on public sector jobs as previously feared. The arrival of good and bad economic news in quick succession has been a hallmark of 2010, and looks set to continue as 2011 approaches. This uncertainty will weigh on advertisers, but most have little choice but to maintain spending at or above current levels. After the declines of 2009, further trimming might affect their market shares.

2. For the moment, the consumer mood is largely positive, buoyed by the prospect of Christmas. Many high street retailers—and several online players, including Amazon—are already offering mark-downs, and sales are healthy in many sectors. In the week ending November 13, the John Lewis group recorded sales of £76.93 million ($120.78 million), up 11.5% on the previous week, and 6.8% higher than the corresponding week of 2009. January may bring a less happy mood, however, as the holiday spirit recedes, some jobs are in jeopardy and value-added tax on most purchases goes up to 20%.

3. While growth in total ad spending may languish in the low single digits, there is little doubt that digital will again outpace traditional media, as in 2009 and 2010. Industry observers are unanimous in predicting that display (driven by sharply higher spending on video ads and social media placements) will gain further momentum, while paid search also thrives and mobile marketing moves up a gear.

The European Commission (EC) is taking the UK government to the European Court of Justice for its failure to comply with regional legislation on internet privacy.

This is the latest installment in the long saga of BT (formerly British Telecom) and its trials of behavioral targeting in selected areas of the UK in 2006 and 2007. Unbeknownst to internet users in these areas, BT collaborated with targeting company Phorm to collect online browsing data. This information was used to select ads for delivery to individual computers. After many complaints, the UK Information Commissioner’s Office (the country’s personal data protection authority) began an investigation into the country’s monitoring and handling of such incidents in April 2009.

Its conclusion: no laws had been broken by BT or Phorm. But that judgment implied another question: were UK laws on internet privacy sufficient? The EC has said no—that the UK does not comply with European Union rules, specifically the ePrivacy Directive and the Data Protection Directive, which state that a person’s consent to interception of their communications must be a “freely given, specific and informed indication of a person’s wishes,” rather than a default presumption. The EC is also concerned that the UK has no national body to deal with such matters of communications interception and related complaints.

In October 2009, the EU Telecoms Commissioner asked the UK to amend its national laws to ensure compliance with regional ones. This has not happened; hence the court summons.

Advertisers and marketers are not directly affected by the legal proceedings. The court case relates to actions that only the government can take; moreover, the EC is not aiming to prohibit behavioral targeting, but to ensure that consumers are notified that targeting is taking place, or may take place, and that they are able to manage their own exposure to it.

But the EC’s move serves to remind the industry that it must “bite the bullet” on behavioral targeting and institute transparent practices that will allay consumer worries. Several recent studies have revealed significant levels of concern among web users. Earlier this year, for example, a survey by the Financial Times and Harris found that 52% of UK internet users said they were somewhat or very concerned about personal data accessible to the search engines they used.

Transparency is especially important in a world where mobile, online and broadcast channels are converging. A growing number of people in the UK are communicating, searching, viewing and sharing content, playing games, shopping and transacting across multiple screens and platform providers—who naturally want to monetize the user data they capture. It has never been more vital to reassure consumers that their privacy is respected.

As new media age magazine points out, the digital industry is already developing, in consultation with the European Union, “a pan-European self-regulatory framework for behavioral ad targeting.” In the UK, the Internet Advertising Bureau (IAB) has issued Good Practice Principles and launched a website, Your Online Choices, to explain the principles of digital data collection and consumers’ options.

Marketers should make sure that they too are fully informed about how their ads are targeted and whether those techniques pose any potential issues for consumers. As the industry moves on from the early days of opt-in email newsletters, and ad-serving technology permits ever-subtler pinpointing of specific audiences, advertisers and brands can gain respect and loyalty if they are seen to acknowledge and act on consumer concerns.

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The ad:tech London conference rang several changes in 2010. For one thing, conference sessions were located in the same hall as exhibitors’ stalls and the seminars delivered by industry experts. This made for a buzzy gathering and more concentrated networking.

In another departure, a representative of the print publishing fraternity struck a positively optimistic note. According to Martin Morgan, CEO of the Daily Mail and General Trust, the DMGT now derives 30% of its revenue from digital. With 44 million unique users each month, the Daily Mail earns significant sums from advertisers. As a result, Morgan confidently predicted that the Mail site will remain free to access—and should pick up additional readers from news providers that move behind pay-walls.

But the big stories were social and mobile. Since last year, social media services have consolidated their position in the limelight. Shiva Rajaraman, product manager at Twitter, kicked off the two-day program, sharing some statistics (the site attracted an average 90 million tweets per day in September 2010) and news that the company will soon allow advertisers to target Twitter users on the basis of who they follow and what they are looking for. 

Next up was Colm Long, Facebook’s director of online operations, EMEA. Impressive stats here, too: According to Long, the site now operates in 70 languages (translated within hours by about 300,000 volunteers around the world), and 150 million people access Facebook via mobile apps. In the UK alone, there were almost 28 million users at the start of September 2010—more than 45% of the population, and about 55% of web users. Over 60% of UK Facebook users log in daily, and 52% are female.

Other speakers reporting from the front line of the social frontier included Nicole Vanderbilt, CEO of furniture and interiors site mydeco, which currently boasts 1.2 million unique visitors per month. Advanced software enables users to plan rooms, decorate and furnish them virtually, and offers various sharing options too. Site visitors can comment on the room plans and reviews of other users. Mydeco also benefits from the 1 million monthly click-throughs to retail partners whose goods are shown on the site.

Meanwhile, luxury brand owner LVMH is pioneering the concept of “open luxury.” The key, said Kamel Ouadi, EVP, Digital for Louis Vuitton, was to recognize the complex emotions associated with luxury in consumers’ minds, and recreate those by digital means. LVMH has tapped top-flight writers, artists, photographers, filmmakers, designers, actors and fashion figures to create exclusive high-end content for a new website, Nowness.  Launched in February 2010, the site aims to become “the essential reference point for luxury global lifestyle” and to disprove the notion that luxury and exclusivity sit oddly with social media. One new film or audio production from the stable of creative talents is uploaded each day. The site, said Ouadi, incorporates software “capable of assessing our users’ interests and tailoring our recommendations for stories to reflect their preferences as they browse the content archive.” The site now claims 200,000 unique monthly visitors.

Dell too is exploring the intersection of intimacy and scale, according to Manish Mehta, Vice President, Global Online for the computer giant. The goal, he said, was to take social media “beyond campaigns,” and ensure that Dell established an online “voice” that served as both foundation and expression of the brand. The company is also taking steps in social commerce—one project aims to create a tag cloud for aggregated product reviews, and post the results on Facebook.

Mobile business has also leapt ahead since 2009. Thankfully, the industry is well past the point of asking whether this is “the year of mobile”; recent statistics and projections speak for themselves. According to Ian Carrington, Google’s director of mobile advertising for the EMEA region, mobile search is growing at 400% per year, and spending in this area is set to climb from £500 million ($700 million) in 2009 to £2.8 billion ($3.9 billion) by 2013. Of course, not every proposition succeeds in this highly competitive marketplace. Carrington cited evidence that 90% of mobile apps are deleted within 30 days of download, as their novelty or usefulness wanes. But consumers’ willingness to engage and transact via mobile is good news for many retailers. Overall, said Carrington, Google has found conversions to purchase 43% higher on the mobile platform than on PCs.

Life isn’t always easy for exponents of the new mobile way of life, however—to judge by the recent adventures of Alexandre Mars, CEO of mobile communications agency PhoneValley and Head of Mobile for Publicis Groupe. Mars appeared on the ad:tech stage walking gingerly, and sporting a black eye. Apologizing for his appearance, he told the story: A few days earlier, he was attending meetings in New York City, where stocks of the iPhone 4 were low or nonexistent. Walking alone one evening, he was attacked and beaten by a gang of young people eager to get their hands on the coveted handset. The bruises, said Mars, were taking a while to heal. But he did manage to hang on to his iPhone.

An estimated 77% of UK adults ages 16 and older, or 38.3 million people, use the internet regularly in 2010, according to recent data from the Office of National Statistics (ONS). More than 30 million individuals now go online every day, or almost every day, and 73% of all households have web access.

Most members of the online family in the UK are doing well, using internet services more and also developing new habits as innovative options emerge.

For example, email is not only alive but thriving, used by an estimated 90% of the UK internet population. Finding information on goods and services was the second most popular activity (75%), followed by travel and accommodation services (63%). More than half of web-enabled adults said they banked online; 51% said they accessed news or magazine content.

E-commerce is going strong too. An estimated 31 million shoppers paid for something on the web in the 12 months prior to polling, said the ONS. More than half (52%) purchased clothes, while 47% bought films and music online; 24% had bought groceries and food.

At the same time, mobile web use is up sharply. Some 31% of web users said they went online via mobile phone in 2010, compared to 23% in 2009.  Among younger users (ages 16 to 24), an estimated 44% browse the internet on their phones. In addition, researchers reported, 2.7 million people used wireless hot-spots in early 2010.

TV is a big draw, with roughly 17 million people streaming television content from the web. Men were more than twice as likely to do this—perhaps because they are more likely to seek out snippets of news, sports or financial coverage during the day. Or perhaps women make more effort to watch when their favorite programs are broadcast. Whatever the reason, the ONS found that 52% of male web users had used video-on-demand services like the BBC iPlayer and Channel 4′s 4oD, compared to 23% of women.

So online merchants, mobile operators, broadcasters and video content owners are among the parties best pleased by these statistics. Advertisers and marketers will be happy too, as the heavy usage and significant spending power of their online audiences are confirmed once more. Among individuals with incomes of £41,600 ($65,300) and over, an estimated 98% are internet users.

Yet some results make discouraging reading for those in the government and the services sector who hope to shift more operations to digital channels. While internet use is virtually universal among adults ages 16 to 24, for example, the opposite end of the age spectrum is still poorly represented. Three-fifths of people 65 and older have never gone online, the ONS estimated. This may persuade the Conservative-Liberal coalition that spending on internet delivery of social services such as pensions advice is not warranted, especially when widespread cuts to IT budgets are looming.