Following a half dozen years of volatility, the world's advertising economy is poised for a corresponding period of stability in which will expand at healthy mid-single-digit rates more correlated with macroeconomic growth, according to GroupM President-Business Intelligence Kate Scott-Dawkins, who released the holding company's updates to its global and U.S. forecasts this morning.
Citing a stabilization of macroeconomic indicators, as well as stimuli from the innovation of AI, as well as the digitization of media and commerce channels, Scott-Dawkins projects the worldwide advertising economy will grow at a compound annual rate of 5.6% over the next five years, reaching $1.2 trillion -- excluding political ad spending -- by 2028.
"It’s quite complex," Scott-Dawkins said during a press preview of GroupM's forecast late last week, which she is presenting this morning along with top executives of IPG Mediabrands' Magna and Publicis Media's Zenith during the opening session of UBS' annual Global Media and Communications Conference in New York City this week.
Citing economic data such as low global unemployment rates, resilient consumer spending confidence, and the creation of new businesses -- especially so-called "digital endemics" -- Scott-Dawkins said the worldwide advertising marketplace should expand at a relatively even keel for the foreseeable future.
In terms of this year and next, GroupM is predicting relatively tepid growth for the U.S. (2.0%) and worldwide (4.6%) in 2023, which will actually represent a decline in real growth due to inflation, but will resume real growth expansion in 2024 for both the U.S. (7.5%) and worldwide (6.7%), including political ad spending.