Fri. Feb 23rd, 2024

    Global ad market to slow in 2024, US political spending to rise: forecast

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    Global advertising spending will end 2023 up 5.8 percent to $889 billion, before slowing to a 5.3 percent rise to $951.8 billion next year, excluding advertising spending politics, advertising media giant GroupM’s forecast said on Monday.

    Political advertising spending is expected to reach $15.9 billion in 2024, seen as a possible new record. For the US market, advertising revenue growth is expected to reach a 5.7 percent increase in 2023, before falling to a 4.1 percent increase next year, if political advertising spending is excluded. .

    China will see advertising revenue growth of 6.1 percent this year, up from a projected 4.7 percent rise in 2024, as the overall economy continues to contract and housing market and youth unemployment concerns weigh on the minds of consumers.

    The latest predictions from rival MAGNA predict that global media owners will see advertising revenue reach $853 billion in 2023, up 5.5 percent from 2022 levels, and will see growth of 7.5 percent. 2 percent in 2024.

    As GroupM forecasters see it in their latest global year-end survey of the advertising industry, digital platforms like Google and Meta are directly challenging traditional media players like linear TV channels for dominance in the market. global advertising investment space.

    And they are winning.

    Currently, nearly 70 percent of global advertising revenue goes to digital platforms, a figure that is expected to rise to 75.5 percent by 2028. The top five global advertising vendors (Google, Meta, Bytedance, Alibaba and Amazon) use artificial intelligence and go directly to Consumers will see compound revenue growth of 25.4 percent annually between 2016 and 2024, GroupM said.

    During the same period, traditional media owners and the largest marketers and advertising agencies saw their own compound revenues grow by just 0.6 percent. This has anointed global digital giants, including TikTok and YouTube, as the new champions of the advertising game, while the United States and China remain the two largest global markets when it comes to advertising revenue.

    “…We seem to have reached a major turning point in realizing that linear television is truly in decline, advertising growth is dominated by a handful of large media and commerce companies, and the economics of this industry It is based on this new world. order, where large advertisers and agencies represent a minority of the revenue of some of their largest partners,” argued GroupM forecasters.

    Globally, total television advertising revenue over the next five years is estimated to grow just 1.1 percent on a compounded annual basis. That growth will come primarily from connected television or Smart TV over traditional cable connection, which is expected to grow 9.5 percent, from $29.2 billion in advertising revenue in 2023 to $45.8 billion in 2028.

    Linear TV, on the other hand, will continue to see a decline in advertising revenue through 2028, when digital-only advertising revenue is forecast to be larger than the entire advertising industry in 2022, according to GroupM. Advertising spending on ad-supported streaming services is growing and GroupM sees the tipping point when its advertising revenue surpasses that of traditional media channels in 2026.

    Since linear TV channels have more advertising minutes per hour than ad-supported streaming platforms, GroupM forecasts a 17 percent decline in average hourly TV advertising over four years.

    For MAGNA forecasters, digital-only media will similarly outperform traditional media owners, who will see their own advertising revenue decline by 4 percent to $266 billion in 2023. By contrast, Digital media owners will see their advertising revenue grow by 10.5 percent to $587 billion, or 69 percent of total advertising sales, in 2023.

    Global ad market to slow in 2024, US political spending to rise: forecast

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