Global advertising spend is on track to surpass $1 trillion for the first time this year, reaching $1.07 trillion, according to new predictions from WARC’s global advertising spend outlook for 2024/25. This marks a significant milestone in the industry, with a 10.5% increase in spend compared to the previous year. The growth in advertising investment has been substantial over the last decade, more than doubling in size.
A major driving force behind this growth has been the dominance of tech giants such as Meta, Amazon, and Alphabet, which have accounted for over 70% of the incremental spend in the industry. These companies are expected to continue to attract a significant portion of advertising spend, with their share projected to increase to over 46% by 2026. This trend highlights the increasing importance of digital advertising platforms in the industry.
In terms of regional growth, North America is expected to lead the way with an 8.6% increase in ad spend this year. The US presidential election race is a key factor contributing to this growth, with political spending alone set to reach $15.8 billion. In contrast, growth in APAC is expected to cool to 2%, while Europe, Latin America, and the Middle East will see moderate increases in ad spend.
Digital advertising is set to drive growth in the industry, with retail media, social media, and search accounting for 85% of online spend. Retail media is expected to lead the way with a 21.3% increase in spend, highlighting the importance of targeted advertising and first-party data in reaching consumers effectively. The rise of new players in ad selling, such as Uber and Chase, further emphasizes the value of data-driven advertising strategies.
WARC’s director of data, intelligence, and forecasting, James McDonald, notes the importance of first-party data and AI enhancements in shaping the future of the advertising industry. The use of AI-enabled media tools is becoming increasingly prevalent, with WARC incorporating a new neural network machine learning model in its research to provide a comprehensive market model.
Overall, the outlook for global advertising spend is positive, with continued growth expected in the coming years. The industry is evolving rapidly, with digital advertising playing a central role in driving this growth. As new technologies and data-driven strategies continue to shape the advertising landscape, advertisers will need to adapt and innovate to stay ahead in this competitive market.