With 2024 in sight, analysts have polished their crystal balls to predict what lies ahead for the ad industry. And after a tough post-pandemic era for the market, exasperated by high inflation and squeezed consumers, there’s finally some good news.
In 2024, global ad spend growth will turn a corner, rising to 8.2% from a modest 4.4% in 2023.
According to the latest numbers from marketing intelligence business WARC, the boost will see the market top $1 trillion for the first time ever.
With a series of tentpole events planned for 2024, including the U.S. presidential election and the Summer Olympics in Paris, advertisers aren’t phased by lingering economic concerns; instead they’re gearing up to let loose.
“High interest rates, spiraling inflation, military conflict and natural disasters have made for a bitter cocktail over the preceding 12 months,” reflected James McDonald, director of data, intelligence and forecasting at WARC.
Now, he believes the latest figures prove the ad industry is about to rebound. However, a closer look at other data points paints a more nuanced picture across markets.
In the U.K., the quarterly Bellwether Report from the Institute of Practitioners in Advertising (IPA), which canvasses the sentiment of 300 brand leaders, has predicted that ad spending will decline in the country by -0.6% in 2024, rebounding in 2025 with a 1.3% growth.
Predicting a “shallow recession,” the report expects contractions in ad spending of -0.6% and -0.4% in 2023 and 2024 respectively. It won’t be until 2025 that ad spending will grow again in real terms, where a modest recovery of 1.3% in annual growth terms has been predicted.
“While Q3 showed encouraging signs that brands are eschewing short-term, quick fix tactics, only those that commit to holding their nerve for long-term brand building will thrive,” said Clare Hutchinson, chief strategy officer at VCCP London.
WARC’s U.K. data takes a rosier view of the U.K. market, pitting that ad budgets will increase by 3.9% in 2024 to hit $45 million (£37.5 million).
It forecasts that the U.S. market will account for just over one-third of global ad spend, predicting it will increase 7.6% in 2024 to hit $326.7 billion.
Industry analyst Brian Wieser, meanwhile, has predicted that U.S. ad industry revenues (excluding political advertising) will climb 5% to $363 billion in 2023 and rise another 4.3% in 2024. While IPG’s Magna insights unit upgraded its U.S. ad growth forecast to upward from 5% to 5.6%.