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Global adspend is set to top US$1-trillion for first time in 2024
By our News Team | 2023
But concerning dominance of ‘big five’ tech firms will see them take over half of all global advertising spending this year.
Global advertising spendING is set to grow 4.4% this year and 8.2% in 2024, a boost that will see the market top US$1-trillion for the first time, according to a new study from data and analytics company Warc.
Within this context, Africa is enduring a difficult year, with ad spend set to be down 11.6%. Growth should return on the continent in 2024, however, buoyed by a 6.1% rise in South Africa.
Photo courtesy of Pixabay
The new analysis, entitled Global Advertising Expenditure & Forecasts Strategy, combines data from WARC’s proprietary survey of media owners, industry bodies, ad agencies and research organisations in 100 markets worldwide with advertising revenue data from 40 of the largest media owners.
“High interest rates, spiralling inflation, military conflict and natural disasters have made for a bitter cocktail over the preceding 12 months, but the latest earnings season shows that the ad market has withstood this turbulence and has now turned a corner,” says James McDonald, Director of Data, Intelligence and Forecasting at Warc.
Five major tech firms – Alibaba, Alphabet (owner of Google and YouTube), Amazon, ByteDance (owner of TikTok and Douyin) and Meta (Facebook and Instagram) – will together take over half of global advertising spend this year.
Ad revenue will rise 9.1% for ‘big five’
With growth ahead of the market, these five companies are expected to see ad revenue rise 9.1% this year and 10.7% in 2024. All other media owners combined will be flat this year.
“Our new measurements show how the fortunes of just five companies have a major bearing on the prospects of the industry at large, and that these companies are on course to record oversized gains in the coming months,” explains McDonald.
With a US presidential election, Olympic Games, and the UEFA European soccer championship for men all in 2024, major events are expected to spur growth. But certain channels are likely to lead:
- Social media will be the fastest-growing medium, with spend rising to a total of $227.2-billion next year – a fifth (21.8%) of total spend. Meta is set to take 64.4% of this.
- Retail media will also be among the fastest-growing advertising channels over the forecast period; spend is set to rise 10.2% this year and 10.5% next year to a total of $141.7-billion – 13.6% of all spend. Amazon is expected to take 37.2%.
- Connected TV (CTV) is also projected to grow notably this year (+11.4%) and next year (+12.1%), reaching a total of $33-billion – only 3.2% of all spend, but 16.2% of premium video spend (CTV and linear TV combined).
The Middle East is among the smallest regions (just 0.7% of global spend) but is anticipated to be the fastest-growing over the forecast period, with spend up 10% in 2023 and 6.2% in 2024.
South Asia is also growing rapidly (+8.9% this year, +12.1% next year), buoyed by a strong Indian market. Ad spend in India is forecast to grow by double digits over the next 18 months to reach a total of $13.7-billion in 2024.
The US market is set to account for just under a third (31.3%) of global spend, with a forecast rise of 2.2% this year and a further 7.6% in 2024.
You can read more about the Warc study here.
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