Advertising spending will grow against the trend in 2024!

Why will advertising spending grow against the trend in 2024? This article will help you explore the reasons. At the same time, this article is recommended for reference by companies engaged in the new media industry.

In today's complex and ever-changing economic environment, the global economy is facing unprecedented challenges. Regional conflicts, persistent inflation, high borrowing costs, and recession signs in multiple markets are seriously shaking market confidence. However, in this economic fog, an unexpected bright spot is gradually emerging.

Surprisingly, advertising expenditure in 2024 showed a growth trend against the trend . This trend not only exceeded market expectations, but also brought a ray of hope to the entire economic environment to some extent. It is worth mentioning that this growth is not a short-term phenomenon, but shows sustainability and huge development potential .

In the latest forecast of "GroupM", we found that this world-renowned advertising company recently raised its growth forecast for global advertising spending in 2024. According to the forecast, global advertising spending is expected to achieve a steady growth of 7.8% in 2024, and the total amount will reach an impressive 989.8 billion US dollars (excluding political advertising), which is a significant increase compared with the previous growth rate forecast of 5.3%. Even more exciting is that it is expected that by 2025, global advertising spending will historically cross the 1 trillion US dollar mark , which undoubtedly marks the beginning of a new era for the advertising industry.

So, what are the reasons that are driving the advertising market to rise to the challenge and achieve growth against the trend?

1. Strong boost from the Chinese and American markets

As the two core forces in the advertising market, China and the United States undoubtedly play a vital role in promoting the development of the global advertising industry.

According to "GroupM" forecasts, US advertising spending (excluding political advertising) will reach US$365.9 billion in 2024 , a growth rate of 5.8% compared to US$345.9 billion in 2023 ; in China, advertising spending is expected to increase to US$199.4 billion, equivalent to about RMB 1.4 trillion .

Remarkably, the combined advertising spending of China and the United States will account for nearly 60% (57.1%) of global advertising costs .

At the same time, the growth momentum of advertising expenditure in these two countries is very strong. "GroupM" specifically pointed out that in 2024, the growth of advertising expenditure in China and the United States alone will reach 44.5 billion US dollars . This figure not only highlights the strong strength of the two countries in the advertising market, but also lays a solid foundation for the continued prosperity and growth of the advertising market.

2. Large platforms dominate the market

According to Kate Scott-Dawkins, president of GroupM Business Intelligence, the advertising market in 2023 showed an obvious trend: large platforms are dominating the market. Data shows that the market share of the top 25 advertising sellers totaled more than an astonishing 72%.

What is more noteworthy is that over the past seven years, the top five advertising sellers - Google, Meta, ByteDance, Amazon and Alibaba - have achieved a compound annual growth rate of 23% . This growth rate is far higher than the market average and shows the strong appeal and competitiveness of these large platforms in the advertising market.

However, when we turn our attention away from these giants and turn to the rest of the market, the picture is quite different. After excluding the revenue of these five giants, the growth rate of the rest of the market is only 2.1% . This figure is not only much lower than the growth rate of the top five advertising sellers, but even lower than the growth rate of global GDP during the same period. This comparison undoubtedly highlights the dominant role played by large platforms in the advertising market.

Although the rise of large platforms has brought new vitality and improvement to the advertising market, Scott-Dawkins also expressed concerns. She pointed out that the growth of the advertising industry is mainly concentrated on the world's largest publishers and platforms, which may lead to further imbalance in the industry . This imbalance may not only squeeze the living space of small and medium-sized advertisers, but also affect the diversity and healthy development of the entire advertising ecosystem.

3. Globalization of Marketing Spending and

Development of precision measurement tools

Against the backdrop of globalization, marketing expenditures are also gradually showing a global trend.

At the same time, as technology continues to advance, more accurate measurement tools have emerged. These two factors work together to reduce the correlation between advertising spending and traditional economic and political turmoil. This trend has become more obvious during the epidemic. In the face of uncertainty, advertising funds have not only not been hindered, but have shown strong adaptability. This reflects that under the dual influence of globalization and accurate measurement, the advertising industry is gradually getting rid of its reliance on traditional economic indicators .

Specifically, advertising spending no longer relies solely on traditional economic indicators, such as GDP, as a basis for decision-making . As Brian Visser, a well-known advertising industry analyst, said: "Even in the case of negative economic growth, advertising spending is still likely to maintain positive growth. If we still use GDP as the main indicator for predicting advertising spending, then this is obviously outdated." Visser's point of view profoundly reveals the changes that the advertising industry is undergoing.

4. The rise of retail media

In addition, another key factor has to be mentioned: "retail media." Scott Dawkins recently raised her growth forecast for the US market in 2024 to 5.8%, and she also predicted that the market will continue to grow steadily at a rate of 4.9% by 2025.

Retail media played an important role in driving this optimistic forecast. Remarkably, the growth rate of retail media was as high as 22%, and the total value was close to 48 billion US dollars . Scott Dawkins emphasized that this significant growth trend "is mainly due to the strong sales data released by retail giants such as Walmart and Amazon at the beginning of the year."

Overall, the global advertising market has been able to maintain strong growth momentum despite many economic challenges, which not only demonstrates the resilience of the industry, but also indicates that the advertising industry is moving towards a new era of greater prosperity and innovation.

Looking to the future, we have reason to expect that the advertising industry will continue to maintain steady growth and contribute to the recovery and sustainable development of the global economy.

Author: Morketing

Source public account: Morketing (ID: 1083455)