Marketers are expected to spend $110 billion in 2023 on paid-search advertising and $29.69 on retail media search, according to a forecast from eMarketer, an Insider Intelligence company.
The data shows that overall U.S. digital ad spending will see its "slowest growth since the Great Recession" -- increasing by less than 10% for the first time in 14 years.
Total media ad spending will rise by just 3.8% due to negative growth from traditional media -- but a healthier U.S. economy will boost the industry in 2024, according to the data.
U.S. paid search in this forecast for 2023 represents 41.8% of the total digital amount spent. It is expected to reach $110 billion, rising 8.2% for the year.
Retail media advertising is forecast to rise 19.7% in 2023, taking 17.1% of the digital ad spend and reaching $45.15 billion in ad spending this year. This is up from $37.73 billion in 2022.
The forecast shows retail media ad spend reaching $106 billion in 2027.
Digital video is expected to hold up display advertising, but the media is expected to decelerate along with the rest of the market, just less dramatically.
The growth of U.S. digital video ad spending will decline slightly from 16.7% in 2022 to 14.1% in 2023. It is expected to rise to 15.4% in 2024 and then decline again by 12.1% in 2025.
Despite the slowing growth, ad spend will rise from $84.14 billion in 2023 to $97.07 in 2024 and $108.85 in 2025.
Overall media spending is expected to increase 3.8% this year as traditional media investments migrate to digital.
Connected TV (CTV) advertising is expected to reach $25.09 billion this year, up 21.2% from 2022.
CTV is forecast to take 9.5% of the digital ad spend, rising to 10% in 2024, and 10.2% in 2025. CTV ad spend is on pace to reach $29.29 billion in 2024.
Social display will see modest growth increase of 3.4% in 2023.
Social-network display advertising is about a quarter of total digital spending.
In 2023, the media continues to take about the same percentage of digital ad spend at 25.9% -- down 3.4%.