Global advertising spend is on track to grow 4.4% to $963.5 billion in 2023, rising 8.2% to more than $1 trillion in 2024 -- but just five companies will carry the weight.
2024 will become the first year that expenditures top the trillion-dollar mark, according to the World Advertising Research Center (WARC), a database of information on advertising and marketing.
The analysis, released Thursday, combines data from WARC’s survey of media owners, industry bodies, ad agencies and research organizations in 100 markets worldwide with advertising revenue data from 40 of the largest media owners to offer a complete picture of the advertising trade.
“High interest rates, spiraling inflation, military conflict and natural disasters have made for a bitter cocktail over the preceding 12 months, but the latest earnings season shows that the ad market has withstood this turbulence and has now turned a corner,” stated James McDonald, director of data, intelligence and forecasting at WARC.
He added that the new measurements show how the fortunes of just five companies have a major bearing on the prospects of the industry, and that these companies are on course to record oversized gains in the coming months.
The five companies are Alibaba, Alphabet, Amazon, ByteDance and Meta. Together, they draw more than half -- at 50.7% -- of global ad investment and are forecast to grow their share to 51.9% in 2024.
Advertising revenue among this group is expected to rise 9.1% in 2023, while ad revenue among all other media owners combined will be flat. In 2024, this group is expected to see ad revenue rise 10.7%.
Financial Services, Technology and Electronics, and Pharma and Healthcare are set to become the fastest-growing sectors next years, with political ad spend to push highs to at least $15.5 billion, estimates WARC.
With Google’s parent Alphabet to lead as one of the five movers, search is on course to reach $229.2 billion in 2024 -- equivalent to 22.0% of all advertising spend at that time.
Google will remain the dominant player, with an 83.1% share of the search market in 2024 -- up from 82.6% in 2023 and equal to $190.5 billion in ad revenue.
China’s Baidu will see its ad revenue rise modestly but its share dip to 6.5% next year, while Bing’s share of the search market is set to hold at 6% despite revenue growing to $13.6 billion next year.
Retail Media will become among the fastest-growing advertising channels.Spend is forecast to rise 10.2% this year and 10.5% next year to a total of $141.7 billion -- accounting for 13.6% of all spend. Amazon will dominate this space with an expected share of 37.2% of all retail-media spend equating to $52.7 billion next year. Alibaba, Amazon’s Chinese rival, is losing ground to Pindoudou -- with 14.4% of global retail media spend next year, followed by JD.com at 9.9% and Meitaun at 3.7%.
Social media is forecast to become the fastest-growing medium, with spend rising to $227.2 billion next year, 21.8% of total spend.
Meta -- which owns Instagram, Facebook and WhatsApp -- will control 64.4% of the social media market, with expected ad revenue of $146.3 billion next year.
TikTok owner Bytedance follows, with estimated ad revenue of $39.9 billion in 2024 equating to a 17.6% share, some 3.5 times smaller than Meta.
Connected television (CTV) is also projected to grow to 11.4% this year and 12.1% next year -- reaching $33 billion. CTV media owners are mostly competing for existing TV budgets rather than winning share of spend from digital channels like social, or accessing new budgets such as retail media, according to WARC.
Increased spend on CTV will not be enough to offset declining spend on linear TV (-5.4%) this year, though political and sporting events are set to boost linear TV spend by 3.5% in 2024. Linear TV is still the world’s third-largest advertising medium, with an expected share of 15.6% equating to advertiser spend of $163.0bn in 2024.
Outdoor will rise 7.3%, with cinema growing 5.2%; and audio, 3.3% -- all increasing, although losses are expected among publishing media at 1.9%, including a 1.6% dip for news brands and 2.5% fall for magazine brands.