2023 Ad Spend Grows Slowly, Paris Olympics, UEFA Cup, US Elections To Accelerate It In 2024 – Report

A dentsu Global Ad Spend Forecasts covering 58 markets across all regions has predicted worldwide advertising spend to increase by $23.0 billion to reach a total of $727.9 billion in 2023. Despite the boost by the FIFA Women’s World Cup and the Rugby World Cup in the second part of the year, ad spend growth in 2023 (3.3%) is expected to be slower than in 2022 (7.9%).

However, adspend for the 2024 is now projected to increase by 4.7% to reach $762.5 billion, boosted by major events such as the Paris Olympics , UEFA nations cup, and the US presidential election.

The ad spend growth in 2023 will be driven by media price inflation, with ad spend at constant prices declining by 0.6%. Looking at the quarterly picture, ad spending got off to a slow start compared to the strong post pandemic revival in Q1 2022. However, the report anticipated a recovery in the second half of the year with the strongest growth to be in Q4 (4.8%).

While the Americas recorded the fastest growth in 2022, Asia-Pacific is forecast to experience the greatest pace in 2023 (4.6%), with higher than expected ad spend growth in China and a very dynamic Indian ad market.

The Americas region is projected to grow by 2.9% and the EMEA region by 1.9%. Latest predictions indicate growth in all twelve major markets including Germany and Italy, both forecast to decline in the December 2022 edition dentsu Global Ad Spend Forecasts.

The US ($7.7 billion), China ($6.0 billion), India ($1.5 billion), and the UK ($1.3 billion) will be the markets contributing the most to the $23.0 billion incremental advertising spend in 2023. The 2023 global ad market is projected to be 24.3% greater than it was in 2019 before the COVID-19 pandemic.

Some markets have grown even more significantly – both in volume and through inflation – in that period, such as UK (45%), India (44%), Brazil (34%), US (31%) and China (29%). Of the 12 markets with the highest ad spend across the globe, only Spain will continue to be below its pre pandemic spend in 2023 (-4.3%).

Digital is forecast to grow by 7.8% ($30.6 billion) YOY – more than double the rate of the total market – to reach $424.3 billion by the end of 2023. However, 2023 is forecast to be the first of three consecutive years of single digit growth, with digital growth forecast at 6.2% in 2024 and 5.9% in 2025. During this three-year period, digital’s share of spend is projected to increase by a percentage point each year from 58.3% in 2023 to 60.3% in 2025.

Whilst display growth is slowing and direct/traditional insertion order buys are declining in 2023, the report expect to see continued rapid growth for the emerging digital categories such as retail media (18.0%) and connected TV (15.2%), and for ad inventory transacted programmatically (14.4%).

The growth rates of most of the sectors tracked in the dentsu Global Ad Spend Forecasts are projected to slow in 2023 – in line with the general market trend. However, notable growth is forecast for automotive and travel and transport – the two sectors that declined the most in 2020, whilst the retail sector continues with the highest share of advertising spend overall.

A moderate recovery across all sectors is anticipated in 2024. Growth forecasts for 2024 have been revised up in 34 markets. Advertising spend for the next year is now projected to increase by 4.7% to reach $762.5 billion, boosted by major events such as the Paris Olympics and Paralympics, UEFA Euro, and the American presidential election.