WARC now projects global advertising expenditure to rise by 6.2% in 2025, reaching a total of $1.16 trillion. The latest WARC Media study revises the figure downward by 0.5 percentage points from its March forecast, as several major sectors adjust their strategies in response to increasing market volatility.
Economic Uncertainty Influencing Ad Spend
James McDonald, Director of Data, Intelligence & Forecasting at WARC, said: “Trade tensions are forcing major sectors to rethink their ad strategies. Automakers are cutting back amid rising costs and a pivot to performance media, while retailers tighten budgets as tariffs squeeze margins.”
The report identifies retail and automotive as two sectors reducing their advertising budgets the most this year. Retail ad spend will fall by 6.1%, while automotive will decline by 4.0%.
Also Read:WARC lowers 2025 global ad spend forecast amid economic uncertainty
Muted Growth in Key Industries
In addition to retail and automotive spending cuts, the report observes muted advertising growth among technology and consumer packaged goods (CPG) brands compared to previous performance levels.
The automotive industry invested $56.8bn in advertising last year, with almost a quarter (22.9%) going to premium video formats. However, manufacturers are stalling, and key players are paring back brand building, causing spend to fall by 4% this year. Advertisers are shifting budgets from video to digital platforms, with automotive spend on social ads surpassing linear TV for the first time in 2025. The sector will rebound next year with a 7.5% rise, pushing spend to a total of $58.6bn.
Retail, with projected ad spend of $166.1bn this year (14.3% of the global ad market), will record a 6.1% drop from 2024 levels. The decline largely reflects impending US trade tariffs on key goods and raw materials, which will raise costs for global retailers, especially those heavily reliant on Chinese imports such as Amazon and Walmart.
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The tech and electronics sector will spend $90.3bn on advertising this year. A year-on-year rise of 5.5% marks a cut from WARC’s earlier +6.2% forecast in March and a sharp slowdown from the 24.3% rise recorded last year. Tariffs are prompting the sector to adjust go-to-market strategies, with companies shifting investments toward less-affected regions or different product lines to protect hardware margins.
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Consumer Packaged Goods (CPG) companies posted their weakest first quarter sales revenues since the pandemic. Tariffs reaching as high as 145% for Chinese imports—and additional duties on goods from Canada and Mexico—are disrupting established supply chains. WARC expects core CPG sectors such as soft drinks (+7.1%), toiletries and cosmetics (+7.2%), and household and domestic products (+4.2%) to grow their ad spend globally this year, though all will see a significant slowdown from 2024.
These adjustments mirror a broader trend of caution across the advertising industry, as brands navigate economic uncertainty and shifting global trade dynamics.
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