Global Ad Spend to exceed $1 Trillion in 2024, five tech titans dominate investment
By Zion Rufus
WARC, a prominent authority in marketing effectiveness, unveils a significant prediction: global advertising spend is on track to surge by 4.4% this year and an additional 8.2% in 2024, marking a historic milestone as it surpasses the $1 trillion threshold for the very first time.
In this groundbreaking study, released today, WARC combines its comprehensive survey data, which encompasses media owners, ad agencies, industry bodies, and research organizations in 100 global markets, with the advertising revenue data from the 40 largest media owners, culminating in an unprecedented view of the advertising landscape.
An intriguing finding of this research highlights that a mere five companies—Alibaba, Alphabet, Amazon, Bytedance, and Meta—are poised to capture a staggering 50.7% of global advertising spend this year. This dominance is anticipated to intensify in 2024, with these conglomerates commanding 51.9% of ad spend. The projected growth for these companies indicates a 9.1% surge in ad revenue this year and a substantial 10.7% increase next year, while ad revenue across all other media owners is predicted to remain stagnant in 2023.
The resurgence of the social media sector, contributing a significant 20% of total ad spend, is projected to drive growth well into 2024. However, emerging avenues such as retail media and connected TV (CTV) are positioned to gain substantial brand investment over the next 18 months.
James McDonald, the Director of Data, Intelligence, and Forecasting at WARC, and the architect behind this study, states, “Despite a challenging year marked by high interest rates, inflation, conflicts, and natural disasters, the advertising market has showcased its resilience and taken a positive turn. The fortunes of a handful of corporations have a pivotal impact on the entire industry, and these companies are expected to experience remarkable gains in the near future.”
He adds, “With the establishment of retail media as a formidable advertising channel, the rise of connected TV as the next phase of conventional video consumption, and the ongoing growth of social media and search platforms, it’s clear that advertisers are recognizing the power of leveraging first-party data to deliver targeted messages to the right audience at the right time.”
**Key Takeaways from WARC’s Global Ad Spend Outlook 2023/24: Withstanding Turbulence:**
– The projected global ad spend for 2023 is set to reach $963.5 billion, marking a 4.4% increase, with an anticipated 8.2% growth in 2024, propelling it to cross the $1.04 trillion mark.
– Notable growth drivers include the US Presidential campaign, major sporting events, and improved trading conditions, particularly in China.
– The report indicates Social Media as the fastest-growing medium, with a total spend of $227.2 billion in 2024, contributing 21.8% of the total ad spend. Notably, Meta, the parent company of Instagram, Facebook, and WhatsApp, is set to command 64.4% of the social media market.
– Retail Media and Connected TV are anticipated to be the leading advertising channels over the forecast period. Amazon’s dominance in the retail media space, Alibaba’s competition in the Chinese market, and the promising growth of Connected TV are among the highlights.
– Ad spend in regions such as the US, Europe, Asia, the Middle East, and Africa presents a diverse landscape with varying growth patterns and trends.
As the advertising industry embarks on a remarkable journey toward reaching the historic milestone of $1 trillion in global ad spend, the role of technology, data, and market dynamics will continue to shape the trajectory of growth and define the strategies of advertisers worldwide.
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