Advertising spend set to surpass $1tn worldwide

Warc said that it expected advertising spend to rise 10.5% globally this year, representing a 2.3 percentage point increase on Warc’s forecast for the year.

North America was expected to grow 8.6% this year to $348bn, with Asia-Pacific seeing growth at 2% worth $272bn.

European advertising spend was forecast to rise 5% to $165bn, Latin America up 6.2% to $32.1bn and the Middle East to rise 4.2% to $12.6bn.

Advertising spend growth is also anticipated to rise 7.2% in 2025 and 7% in 2026, culminating in a global advertising market worth $1.23tn.

The forecasts mean that global advertising investment has more than doubled over the last decade, and has grown 2.8 times faster than global economic output since 2014.

Warc said that three companies – Meta, Amazon and Google parent company Alphabet – account for more than 70% of this incremental spend and are expected to attract 43.6% of all advertising spend this year, rising to more than 46% by 2026.

Pureplay, or online only, internet companies are set to record a 14% rise in advertising revenue this year, said Warc, reaching a total of $735.7bn.

Warc added that almost nine in every ten ( 88.5%) incremental dollars spent on advertising this year will go to online-only businesses, with half ( 52.9%) being paid to Alphabet, Amazon and Meta.

Taken together, pureplay platforms are set to account for more than 70% of all advertising spend worldwide next year.

Retail media (up 21.3%), social media ( 14.2%) and search ( 12.1%) are set to lead digital growth in 2024, Warc added, with these three sectors alone accounting for more than 85% of online spend and almost three in every five ( 58.7%) incremental dollars spent on advertising worldwide this year.

The projections are based on data aggregated from 100 markets, with Warc also using a neural network machine learning model which anticipates advertising investment patterns based on more than two million data points spanning macroeconomic data, media owner revenue, marketing expenses from major advertisers, media consumption trends and media cost inflation.

James McDonald, director of data, intelligence and forecasting at Warc, and author of the research, said: “The global ad market has doubled in size over the last decade, with advertising investment growing almost three times faster than economic output since 2014.

“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. Such data, combined with new AI enhancements, will constitute the fabric of the advertising industry for the next decade and beyond.”