Global advertising is expected to be in excess of $1trillion for the first time this year.
Almost half of this (43.6%) will be spent with Meta, Amazon and Alphabet.
That’s according to to the new WARC Global Ad Spend Outlook report for 2024/5.
Advertising spend is forecast to rise 10.5% this year, reaching $1.07trillion. North America will lead the growth (8.6% – although when you remove election advertising, that falls to 4%). Latin America is second (6.2%) while Europe is third at 5%, or $165bn.
This growth is predicted to continue, with the global ad market expected to be worth $1.23trillion by 2026.
Global ad investment has more than doubled over the last decade, and has grown 2.8x faster than global economic output since 2014.
Just 3 companies – Meta, Amazon and Alphabet – account for more than 70% of this incremental spend. Their current share of ad spent is 43.6%, which is expected to reach 46% by 2026.
WARC’s projections show that pureplay internet companies are set to record a 14% rise in advertising revenue this year, reaching a total of $735.7bn.
Retail media (+21.3%), social media (+14.2%) and search (+12.1%) are set to lead digital growth in 2024, with these three sectors alone accounting for over 85% of online spend.
“With retail media expected to lead ad spend growth over the coming years, and with new, diverse players emerging in ad selling – from Uber to Chase – we are once again seeing the value of first party data in targeting the right person with the right message at the right time,” said James McDonald, Director of Data, Intelligence and Forecasting, WARC, and author of the research.
“Such data, combined with new AI enhancements, will constitute the fabric of the advertising industry for the next decade and beyond.”
Social Media is the single largest advertising channel ($241.8bn), having overtaken search (excluding retail media) for the first time last year. It accounts for 22.6% of all global ad spend this year.
Within social, Meta is the largest individual player, with 62.6% of the market. Its closest competitor is Bytedance (Douyin and TikTok), which has grown its share to 20.1% from 9.3% 5 years ago.
Over half of all AI-enabled spend occurs in the social media sector.
Search advertising (excluding retail media) accounts for 21.8% of global advertising spend ($223.8bn).
Google accounts for 84% of the global search market, with its paid search revenue set to top $200bn for the first time next year. Google’s share rises to over 90% if China is excluded.
Retail media is expected to account for 14.3% of global ad spend this year – a total of $152.6bn.
Legacy media, encompassing print publishing, broadcast radio, linear TV, cinema and out of home (OOH), now collectively account for a quarter (25.3%) of total advertising spend, having recorded a dip in share in each of the last 15 years.
Advertising spend on legacy media is expected to total $270.5bn this year, representing a 1.5% rise from 2023 – however, this is mostly due to US political spend.
Regionally, UK is the largest European market by spend and is expected to post an 8% rise to £38.5bn in 2024.
