E-commerce and media consumption shifts will drive digital ad sales
By our News Team | 2022
Digital advertising is expected to rise by 8% next year, says Magna. OOH and digital video will be among the best performers.
Magna, the global media investment and intelligence company, has downgraded its growth estimates for the global advertising industry and is now expecting 5% growth in 2023, versus the 7.5% predicted in its June 2022 report.
It attributes this expected downturn to a deteriorating macroeconomic environment that includes factors such as the Russia-Ukraine war and the international cost-of-living crisis.
Photo by Andres Ayrton from Pexels
But digital ad sales are expected to rise by 8%, reaching US$557-billion in global sales and comprising 65% of all ad sales.
E-commerce and ongoing shifts in media consumption habits will drive digital ad sales, Magna believes, with digital video expected to be the fastest-growing ad format.
A recovery in social media?
A recovery in social media could see ad sales increase 7% in the segment, while search is expected to gain 10%.
OOH had a brighter-than-most 2022 and is expected to make a full global recovery in 2023, reaching $33.5-billion in ad revenue.
Strong growth is expected for ad-supported video on demand and linear addressable. Resilient pricing and sport genres are also expected to cushion the TV sector, while rising concerns around brand safety could slow digital investments for some marketers, potentially benefiting TV.
”Marketers continue to value the brand safety that editorial media vendors deliver, combined with expanding cross-platform opportunities,” said Vincent Létang, Executive Vice President of Global Market Research at Magna and author of the report.
Major global markets such as China and India could experience a recovery next year. China, the second largest ad market reflecting 15% of global revenue, is expected to grow 7% to $128-billion following a weak 2022 performance of 3% growth. The slow year was largely driven by China’s zero-Covid policy, which has led to internal protests and market disruptions.
India, which is among the top 15 advertising markets globally, is expected to grow 14% next year, with South Korea’s market expected to grow 7%. However, key markets such as Germany, Italy, Spain and Japan are forecast to have little growth.