Forecast: Dentsu Foresees 5% Surge in Global Ad Spend by 2024
With a promising kickoff to the year, advertisers are poised to capitalize on digital prospects, upcoming Olympic events, and the U.S. election in the coming months.
Revised Global Advertising Forecast
Dentsu has updated its global advertising forecast, projecting a 5% growth in ad spend for 2024. This is an increase from the previous forecast of 4.6%. The total worldwide ad spend is expected to reach $754.4 billion, according to the advertising holding company's press release.
After a good start to the year, spending is predicted to rise in the coming months. This increase will be driven by a strong digital advertising market, as well as events like the Olympics and the U.S. election.
Experts forecast a 7.4% increase in digital advertising spending this year, with digital ads capturing 59.6% of the market. Growth in retail media and paid social categories, at 32% and 13.7% year-over-year respectively, will contribute to the overall growth in digital advertising.
Article Insight:
In 2024, ad-spending growth is expected to increase by 2.6% when adjusted for inflation. Prices, particularly for TV and digital video formats, remain high, but there are indications that they may decrease. Dentsu has raised its forecast to a 5% growth for 2024, surpassing the 3.3% growth in 2023 and outperforming the overall economic growth rate by 1.8 percentage points.
The upward revision is attributed to the year starting at a faster pace than expected. Will Swayne, Dentsu’s global president of media, also mentioned that the second half of the year will be significant with events like the Summer 2024 Olympics and the U.S. presidential election. It is predicted that the U.S. presidential election alone will lead to around $11 billion in additional ad spending in 2024.
In terms of advertising channels, digital is expected to experience the most growth. It is projected to reach a total of $449.3 billion in ad spending. This growth will be driven by increases in retail media (up 32%), paid social (up 13.7%), and programmatic (up 10.9%) channels. Paid search and online video are also expected to see strong growth rates of 7.7% and 6.7%, respectively.
Television spending is expected to grow by a modest 2.6%. The increase will be largely fueled by connected TV spending, which is projected to rise by 24.2% year-over-year as streaming platforms expand their ad-supported offerings. On the other hand, broadcast television spending is anticipated to decrease by 0.4% year-over-year.
Out-of-home and cinema spending are forecasted to experience slight growth of 4.2% and 4.8%, respectively. However, audio spending is likely to remain steady with a small increase of 0.4% year-over-year. The only category expected to see a significant decline is print, with an estimated drop of 2.6%.
In terms of regions, the Americas are projected to have the fastest growth, with a 5.9% increase compared to 2.2% in 2023. Asia-Pacific is expected to see a 4.2% growth, driven by growth in China and India at 4.8% and 6.8% respectively. EMEA is forecasted to grow by 4%, with the United Kingdom (up 6%), Germany (up 3.4%), and France (up 4%) leading the way.
The top category for growth is travel and tourism, which is expected to increase by 8.1% as the industry benefits from a post-pandemic rebound. Media and entertainment are also projected to grow by 6.5% due to the increasing availability of content and streaming services.
Editor's P/S:
The revised global advertising forecast from Dentsu paints an optimistic picture for the industry's growth in 2024. The upward revision to a 5% increase underscores the resilience of the advertising market amidst economic uncertainties. The projected growth is primarily driven by the surge in digital advertising, which is poised to capture nearly 60% of the market share. This trend highlights the importance of digital platforms for brands to reach and engage with their target audiences effectively.
Furthermore, the article emphasizes the significant impact of major events like the Olympics and the U.S. election on advertising spending. These events present lucrative opportunities for advertisers to connect with large audiences and amplify their brand messages. Additionally, the growth in retail media and paid social categories signifies the increasing adoption of these channels by businesses seeking to drive sales and build customer relationships. Overall, the forecast reflects the industry's continued adaptation to evolving consumer behaviors and the growing prominence of digital platforms in the advertising landscape.
