ADVERTISING

2024 will see strongest global advertising growth rate in six years

By our African Marketing Confederation News Team | 2024

Ad revenue among online-only businesses such as Alphabet, Amazon and Meta equates to almost 70% of all ad spend globally – Warc.

Global advertising expenditure will increase by 10.7% this year to a total of US$1.08-trillion, according to a forecast from the World Advertising Research Centre (Warc).

This marks the strongest growth rate in six years and the largest absolute rise on record, if the post-Covid recovery of 2021 (+27.9% year-on-year) is excluded, Warc says.

“Our latest forecast anticipates $104-billion in incremental advertising spend worldwide this year,” states James McDonald, Director of Data, Intelligence and Forecasting.

The latest global projections are based on data aggregated from 100 markets worldwide. For the first time, the organisation leveraged a proprietary neural network which projects advertising investment patterns based on over two-million data points.

These span macro–economic data, media owner revenue, marketing expenses from the world’s largest advertisers, media consumption trends and media cost inflation.

Photo by Megan (Markham) Bucknall from Pexels

The report also anticipates ad spend growth in the coming years, with a 7.6% increase expected next year and a 7.0% rise in 2026, culminating in a global advertising market worth $1.24-trillion.

Spend rising faster than economic output

Global ad investment has more than doubled over the last decade and has grown 2.8 times faster than global economic output since 2014.

According to Warc, the headline growth rate has been primarily driven by online media, however TV has also made a notable contribution.

Linear TV (traditional broadcast TV that follows a predetermined programming schedule) spend is expected to end the year 1.9% higher, at $153.6-billion, following two years of decline.

Global TV has been boosted by political advertising – particularly in the US – during the fourth quarter and both the Paris Olympics and the Euro 2024 football tournament in the third. Linear TV now accounts for just 14.3% of global advertising spend, however, down from a peak of 41.3% in 2013, Warc says.

Meanwhile, pure play internet, which encompasses advertising revenue among online-only businesses such as Alphabet, Amazon and Meta, is poised to grow by 14.1% to a total of $741.4-billion. This equates to over two thirds (68.8%) of all ad spend globally.

Social media is the largest individual sector within pure play internet – and the largest advertising medium of all, by extension – with a total of $252.7-billion this year, which is equivalent to 23.5% of the global ad market.

Prospects for the social market have been revised upwards this year to +19.3%, owing mostly to stronger-than expected results for Facebook, Instagram and TikTok over the first nine months of the year.

Regulatory pressures on the horizon

However, WARC suggests the future of this growth could be under threat due to regulatory pressures on major players in the advertising industry.

“Whether this boom will sustain remains unclear, however, as 2025 presents a sliding doors moment due to heightened regulatory pressures on Google and TikTok – together a quarter of the ad market outside of China,” McDonald says.

“This, alongside an increasingly challenging geopolitical climate, may spell uncertain times ahead for the businesses that rely on advertising trade.”