The headline figure in a new report from the World Advertising Research Centre (Warc) is eye-catching: global annual advertising spend will exceed $1 trillion (€900 billion) for the first time in 2024. The centre this week raised its growth forecast for 2024 to 10.5%, reaching $1.7 trillion. A further increase of 7.2% is expected next year.
This is great news for the three companies that dominate the global advertising market: Meta, Amazon, Google, and Alphabet, the owner of YouTube. With their leadership in social media, retail media, and search, this “triumvirate” is expected to capture 43.6% of all ad spend, rising to over 46% by 2026.
The increasing adoption of artificial intelligence (AI) tools is contributing to a boom in retail media, i.e. advertising at or near the point of purchase, as well as double-digit growth in social media and search advertising.
According to Warc, more than half of all additional ad spending this year is going to Alphabet, Amazon and Meta, but over the past decade those three companies have accounted for roughly 70% of all additional ad spending, representing a massive accumulation of financial muscle in a relatively short period of time.
“Legacy media” includes print publishing, radio broadcasting, terrestrial television, movies and outdoor advertising, and collectively now accounts for a quarter (25.3%) of total ad spending, after a decline in its share each year for the past 15 years. But the pessimism is not unanimous, with legacy media advertising expected to grow 1.5% this year due to a surge in U.S. political spending.
In fact, without a Kamala Harris versus Donald Trump showdown, traditional media ad spending would likely fall by 0.5%, Wolk said.
Running for president isn’t cheap. Political ad spending in the U.S. is expected to reach $15.8 billion this year, with more than a fifth of that, $3.6 billion, being spent on social platforms. That would be the highest total ad spending ever for a U.S. presidential election and an increase of more than 40% from the 2020 election.
But during the Joe Biden vs. Trump race, spending lagged compared to 2020. Since the Democratic nominee changed, ad dollars have been pouring in. So while Harris may not have won yet, she’s already had a positive impact on business.
