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2024 looks like it will be a bright year for the advertising industry.
Magna, the research division of IPG Media Brands, predicts that the U.S. advertising market will grow 9.2% this year to about $369 billion, exceeding its previous forecast in December of an 8.4% increase.Ad-free streamer who?
The bulk of this, about $9 billion, will come in the 2024 U.S. election cycle, a 13% increase from the 2020 election cycle, Magna predicts. FWIW, eMarketer projects that total political advertising spending will reach approximately $12.3 billion, nearly triple what it was in 2016.
Flashback: Anyone with a time machine will get a little whiplash when they see this forecast. Growth in the advertising industry had an uneven 2020, jumping 23% in 2021 before slowing to 7% in 2022 and 5.7% last year.
“For the first few months of 2023, everyone was wondering how bad this situation was going to be,” Vincent Letang, vice president of global market intelligence at Magna, told Marketing Brew. Instead, it ended the year with a growth rate of 5.7%.
Recent economic growth forecasts and stabilizing inflation “will give confidence to market players,” he said. “The worst is just around the corner.”
Who gets what? Magna expects ad sales from digital platforms such as Google and Meta to rise 12% to $261 billion, accounting for about 72% of the market. Traditional media owners, including terrestrial broadcasters and publishers, are expected to grow around 3.5%. (Without the Olympics and elections, Magna found, this category would shrink by 3%.)
The streamer, which includes CTV, AVOD and FAST channels, is also expected to see a 13% increase in revenue due to Amazon Prime Video's advertising inventory rolled out in late January.
Where are you from? Advertising spending is expected to grow by 9%, driven primarily by retail and travel budgets, while food, beverage and automotive categories are expected to grow by 6%. Magna predicted that the technology sector, which includes software services, hardware and social platforms, would grow by just 1%, while the entertainment sector would decline by about 4%.
