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U.S. advertising spending is growing faster than analysts thought it would back in December, according to a forecast released by Interpublic Group’s investment arm, Magna.
Interpublic Group’s investment arm Magna expects total advertising spending will grow 9.2% to $369 billion—excluding political spending and tentpole events like the Olympics.
Back in December, Magna predicted 2024 ad spend would grow only by 8.4%.
Here are the most significant takeaways from Magna’s forecast.
Prime Video ads will cause streaming TV to surge
Premium long-form streaming channels will grow 13% this year, Magna predicts, meaning it would claim 22% of total national TV investments.
And Amazon’s new Prime Video ads offering will drive much of that growth, propelling the category to $13 billion.
Retail and travel are hot, but entertainment and tech are not
Retail and travel categories are particular bright spots for marketers and should each grow by 9% this year, according to Magna.
Unfortunately, entertainment and technology verticals continue to be slow-to-no-growth areas. Magna expects tech ad spending to only grow by 1%, while entertainment will decline by 4%.
Political ad spend is propping up traditional channels
Magna forecasts digital ad channels as a whole will grow 12%, to $261 billion. That’s 72% of the total ad spend. Within that sector, search and retail media will grow at a healthy 12% clip, and social media will increase 13%.
While traditional media owners will see ad revenues grow by 3.5%, that’s mostly due to cyclical factors like political advertising. Without political spending, Magna predicts traditional channels will decline by 3%.
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