Advertising Industry
Advertising Industry: Social Media
Forum Topic: https://forum.investmentwiki.org/t/advertising-markets/92
Methodology
Short description methodolgy
Data Sources
- Magna
- Zenith
- Tiniuti
- Dentsu
- S4
Developments
Tinuiti
Q4 2023
| Y/Y Growth[1] | Ad Spend | CPM/CPC | Impressions/Clicks[2] |
|---|---|---|---|
| Meta | 13% | -3% | 16% |
| Fecebook | 8% | -5% | 14% |
| 27% | 2% | 24% | |
| TikTok | 64% | 14% | 44% |
| 17% | 9% | 8% | |
| Amazon | 17% | 19% | -2% |
| Walmart | 62% | 34% | 21% |
Q3 2023
| Y/Y Growth[1] | Ad Spend | CPM/CPC | Impressions/Clicks[2] |
|---|---|---|---|
| Meta | 19% | -19% | 46% |
| Fecebook | 16% | -20 | 46% |
| 25% | -11% | 41% | |
| TikTok | 12% | -8% | 21% |
| 13% | 4% | 8% | |
| Amazon | 14% | 8% | 5% |
| Walmart | 55% | 33% | 17% |
Q2 2023
Most of the major digital ad platforms saw an acceleration in spending growth in Q2 2023, with Instagram leading the way with a 16-point improvement in growth compared to a quarter earlier.[3]
| Y/Y Growth | Ad Spend | CPM/CPC | Impressions/Clicks[2] |
|---|---|---|---|
| Meta | 9% | -25% | 44% |
| Fecebook | 2% | -25% | 37% |
| 31% | -29% | 84% | |
| TikTok | 11% | -4% | 16% |
| 11% | 0% | 11% | |
| Amazon | 8% | 3% | 5% |
| Walmart | 39% | -4% | 45% |
Meta Platforms
- Meta ad spend rose 9% year-over-year versus a flat growth rate in Q1 2023.
- Meta impressions rose 44% year-over-year(Q1 2023:+42%), helped by Reels.
- Meta Platforms CPM fell 25% year-over-year(Q1 2023:-30%).
- Facebook ad spend rose 2% year-over-year, the first positive growth in the last four quarters(Q1 2023:-4%)
- Facebook CPM declined 25% year over year(Q1 2023: -32%)
- Facebook impression rose 37%(Q1 2023: 42%)
- Instagram impression rose 84% year-over-year(Q1 2023: 45%)
- Ad spend growth on Instagram more than doubled to 31% year-over-year from 15% in Q1 2023, aided by Instagram Reels and Explore Grid Home placements.
- Instagram CPM declined 29% year-over-year(Q1 2023: -20%).
- Instagram Reels CPC was 13% lower than that of Instagram Feeds, compared to 19% in Q1 2023.
TikTok
- Tik tok as spend rose to 11%
- TikTok CPM declined 4% year-over-year(Q1 2023:+44%).
- TikTok impression rose 16% in Q2 from a 13% decline in Q1.
Advertising Forecast
Disclaimers
Do advertising agencies like Magna and Zenith have a positive bias?
Magna Forecast
September 2024
** US only Update
Based on MAGNA’s analysis of media companies’ financial reports, total US ad revenues grew by +11.0% year-over-year in the second quarter. That was in line with first quarter, and in line with – slightly stronger – than MAGNA’s projection (+10.4%).[4]
- Digital pure players ad sales, rose by approx. +16% YOY, as both Meta and Google credited new AI tools – optimizing content creation or insertion – as driving incremental spending from brands. The Big Three (Meta, Google, Amazon) reported YOY ad sales growth rates ranging +15% to +18% for the quarter.
MAGNA is increasing its forecast for second half, non-cyclical ad spend growth to +7.4% (previously: +6.4%). The half-year YOY growth rate was always expected to slow down in the second half of 2024 due to very imbalanced comps in 2023 (weak first half, strong second half).
- For the full-year 2024 MAGNA is now expecting advertising revenues to grow by +11.4% to $377bn (+8.9% excluding cyclical). +8.9% would be the strongest non-cyclical growth rate in more than twenty years, if excluding the post-COVID recovery in 2021.
June 2024
MAGNA is raising its 2024 growth forecast following a stronger-than-expected ad market in the first quarter (+12%) and an improvement in the economic outlook (real GDP growth +3.2%, US +2.5%).[5]
- MAGNA’s “Global Ad Forecast” predicts media owners net advertising revenues (NAR) will reach $927 billion this year, growing +10.0% over 2023. This is a significant acceleration on the global growth recorded in 2023 (+6.4%). Neutralizing the impact of cyclical events in 2023 and 2024, the normalized acceleration is still real but more modest: non-cyclical ad revenues grew by +7.5% in 2023 and will grow by +8.7% in 2024.
- 1Q24 was an even stronger than expected. Year-over-Year growth average +12% in key markets, +17% in Spain, +15% in France, and Germany. Quarterly growth rates will gradually slow as comps become tougher in the second half, but this strong start of the year, coupled with a stronger economic outlook led us to raise the full year 2024 forecast for almost every individual market monitor, bringing the expected global growth from +6.4% in December, to +10% now. The full-year ad revenues of traditional media owners are now forecast to grow by +3% instead of +2%, and the ad sales of digital pure players are now expected to grow by +13% (previously +9.4%).
- In the first quarter of 2024, the leading global digital vendors reported the strongest growth rates in more than two years. Based on MAGNA’s analysis of financial report, global Search ad sales grew by +16% year-over-year, pure-play video by +21% and Social Media by +28% year-over-year. Quarterly growth rates are bound to slow down as comps will gradually get tougher, but MAGNA anticipates double-digit growth for all key digital formats and vendors this year.
- Full-year 2023, Google, Meta, and Amazon organic ad revenues increased by +6%, +16% and +24% respectively. The big three now attract a combined 60% of total advertising revenues outside China ($417 billion out of $698 billion), up from 57% in 2021-2022. Including China – where they don’t operate – they control 49% of global ad sales.
- US Media owners advertising revenues are forecast to reach an all-time high of $374 billion this year, growing +10.7% over 2023. This is 1.5 percentage points above our previous full-year forecast (+9.2% in our March 2024 update), following a stronger-than-expected start of the year (+12% in the first quarter) and an improvement in the macro-economic outlook – with the latest GDP growth forecasts raised to a robust +2.5%. The macro-economic factor offsets slightly lower cyclical expectations, as our political advertising forecast is reduced following by weaker-than-expected fundraising in the first few months of the year. We still expect the 2024 election campaigns to generate $9 billion dollars of incremental advertising revenues for US media owners this year, an increase of +10% vs 2020.
- The US remains the largest and most intense ad market in the world with advertisers spending $1,100 per consumer in 2024; it’s 8 times more than the global average ($160), ten times more than China ($110) and a hundred times more than India ($10).
Global Forecasts
US Forecasts
March 2024
Based on MAGNA’s analysis of media companies’ financials, non-cyclical advertising revenues grew by +9.1% in the fourth quarter of 2023 e., the strongest quarterly growth in almost two years, bringing full-year 2023 ad market growth to +5.7%.[6]
Because of an improving macro-economic outlook, the momentum of digital media and streaming, and the impact of cyclical events, MAGNA anticipates more growth in 2024: total media owners ad revenues will increase by +9.2% to reach $369 billion. That’s nearly one percentage point above the previous forecast (+8.4% in Dec. 2023).
Advertising spend around major cyclical events will drive approx. $10 billion of incremental ad sales as the 2024 election cycle will generate $9 billion of additional ad revenue for media owners (+13% vs the 2020 cycle). This will add 2.5 percentage points to the non-cyclical growth rate, bringing total revenue growth from +6.7% (non-cyclical ad sales) to +9.2% (total ad sales). The impact will be even greater for some media categories like Local TV (excluding political -4%, including political +26%).
- Digital pure players (DPP) dominating Search, Retail, Social and Short-Form Video formats will once again capture most of the growth, with DPP ad sales growing by +11.7% to $260 billion (previous forecast +10.5%).
- Short form, pure player digital video ad sales (primarily YouTube and Twitch), will grow by +12% this year to reach $22 billion.
- Social media sales will feel the wind at their back and will rise +14% to $81 billion. Artificial intelligence (AI) is becoming an increasingly important tool used by advertisers to set up, run, and optimize their social media campaigns. MAGNA looks for this to drive additional sales in 2024, especially for small businesses setting up their first campaigns.
- Search/Retail ad sales will increase by nearly +12% to $146 billion in 2024 and will also benefit from increasing AI functionality in helping brands set up and run new advertising campaigns.
- Audio ad sales (terrestrial and satellite radio, audio streaming, and podcasting) will be stable at around $16 billion in 2024. Digital audio usage and ad sales continue to develop but growth rates are maturing (+6%), which means it barely offsets the erosion of linear radio (-3%)
- Long-Form Streaming advertising will expand by +13% to reach $10 billion milestone.
December 2023
MAGNA’s “Global Ad Forecast” predicts that global media owners net advertising revenues (NAR) will reach $853 billion this year, +5.5% above the 2022 level, and will grow by +7.2% in 2024.[7]
- Advertising spending accelerated and grew by +6.3% yoy in the second half of 2023 following a weaker first half (+4.7%) to average +5.5 growth full year.
- Digital Pure-Play media owners (DPP) ad revenue grew by +10.5% to $587bn (69% of total ad sales). DPP ad sales are driven by organic growth factors incl. the rise of ecommerce, retail media
- The US market grew +3.6% to $338 billion this year (National TV -6%, Local TV -22%, Audio -4%, Publishing -7%, OOH +2%, Search +10%, Social +14%). Non-cyclical ad revenue is up +5.4% in 2023 and will accelerate to +5.9% in 2024 (+8.4% including cyclical ad spend – including almost $10 billion in political spending).
- In 2024, economic stabilization, lower inflation, digital innovation, and the return of major cyclical events (elections, international sports events) will drive ad spend +7.2% to $914 billion, +8.4% in the US. TMO ad revenues will recover by +2.2% while digital pure players ad sales will increase by +9.4%.
- After stagnating for several quarters, the global advertising sales of Google, Meta and Alibaba re-accelerated since 2Q23 to reach a year-to-date 1Q-3Q growth of +4%, +13% and +5% respectively.
- These three media owners account for a combined 49% of global advertising revenues. Outside China, the top three vendors are Google, Meta, and Amazon, capturing 80% to 90% of digital ad spend and 56% of total ad spend (the market share being lower for national consumer brands higher for small, local, direct advertisers).
September 2023
Focused on US only
Total advertising spending re-accelerated in the second quarter of 2023. Sales were up +4.4% year-over-year, following two quarters of stagnation.However, only pure-play digital media vendors (Search, Social, Video) really benefited (+8.7% in 2Q23), while traditional media companies continued to struggle (-4.1% in 2Q23).The recovery in ad spend in 2Q23 was caused by a general improvement in the economy, and easier yoy comps[8]
- As the US economy and advertising spending were both stronger than expected so far this year, and digital media is finally recovering from its 2022 woes, MAGNA raises its full-year ad revenue growth forecast to +5.2% for 2023 to reach $337 billion
- With the economic outlook improving and yoy comps becoming even easier, MAGNA maintains its growth forecast for the second half of the year. Total ad spend will grow by +7% to +8% in 3Q23 and 4Q23 (compared to +2.9% in first half) to bring full year growth to +5.2% (excluding cyclical), up from +4.2% in our previous update (June 2023).
- Around the average advertising spending growth of +4.4% in 2Q23, MAGNA observed a strong dynamic from Travel, Pharma and Retail brands, and – more surprisingly – CPG (food, drinks, personal care). The slowdown of inflation in recent months may explain this recovery in CPG brand business and marketing spending, after a difficult year 2022 when high inflation hurt the sales of premium brands.
- Looking at individual media types, digital media formats will outperform again in the next 18 months, growing by high-single digits or low double-digits. Social media formats and short-form digital video formats are finally recovering from the headwinds and disruptions that hurt ad sales in 2022, brought on by the modifications to privacy settings in the Apple environment and the rapid rise of short vertical video snacking.
June 2023
Advertising spending slowed down to a halt in the first quarter of 2023 (+1.5% globally, flat in most Western markets) due to economic uncertainty and the lack of cyclical drivers. There are, however, some drivers mitigating the impact of economic slowdown: Ecommerce and Retail Media bringing more marketing dollars into digital advertising formats, and the counter-cyclical dynamic of some large industry verticals (Retail, Auto, Travel).[9]
- Magna predicts media owners advertising revenues will reach $842 billion this year, +4.6% growth vs. 2022 ($805bn). Deterioration of economic conditions and marketing spending in most Western markets is mitigated by stronger-than-expected growth in some markets (China, Spain), industry verticals (Retail) and media types (Retail, Social).
- Traditional media companies and branding formats (Television, Audio, Publishing, OOH, Cinema) are most exposed in this uncertain business climate, as some brands reduce marketing budget or prioritize performance-based digital ad formats.
- Digital pure-play advertising sales will grow by +8.5% to reach $577 billion dollars i.e., 69% of total ad sales, driven by organic growth factors (ecommerce, retail media, media consumption shifts, stabilization in the data landscape).
- The strongest ad growth rate this year will come once again from India (+12.3% to $12.6bn); India is the 11th largest market. The Chinese ad market is set to recover faster than previously expected (+8.4%). At the other end of the spectrum, most Western European markets will stagnate this year: Germany, France, Italy all below +3% growth all-media, and negative for traditional media owners.
- In 2024, economic stabilization and the return of major cyclical events (US presidential elections, Paris Olympics, Euro Football championship) will re-accelerate ad spend: +6.1% to $892 billion globally, +7.3% in the US. Traditional media owners’ ad revenues will recover by +1% while digital pure players ad sales will increase by +8%.
- Social media formats will re-accelerate by +9.4% this year reach to $172 billion. The industry seems to have turned a corner in 1Q23 when Meta reported a return to YOY growth on an FX-adjusted basis after two consecutive quarters of flat or negative growth. Meta and other established social media vendors seem to have finally recovered from the loss of workable consumer data in the Apple ecosystem since late 2021, and they are making inroads in the monetization of the short vertical videos that have completely changed the user experience, challenging ad optimization, in less than two years.
- North America and European markets will underperform this year (ad market growth of +2.5% and +4.2% resp.), due to weaker economic activity (+1.6% and +0.8% real GDP growth, resp), mature media/marketing landscapes, and a lack of major cyclical driver compared to 2022. APAC (+7.1%) and Latin America (+8.7%) will grow significantly faster.
March 2023
US update
In its new 2023 scenario, MAGNA expects little or no growth in the first half (+2% in 1Q23, +4% in 2Q23) against tough quarterly comps, followed by a recovery in the second half (+6% to +7%), as the economy solidifies, and advertising comps become much easier. Overall, full-year advertising revenues will grow by +3.4% this year to reach $326 billion (incl. CE).[10]
- Search and e-commerce advertising formats (Google, Amazon, retail media networks) will continue to be driven by the expansion of e-commerce to CPG and grow by +10% (slowing down from +14% in 2022) to remain the largest advertising format ($125bn in 2023)
- Social media formats (Facebook, Instagram, Tiktok …) will re-accelerate +6% to $66bn after stalling in 2022 (+2%) due to headwinds including audience maturity and the data targeting limitations established in 2021.
- Cross-platform audio ad sales will stabilize at around $17 billion this year. Linear radio ad formats will drop -4%, while digital audio formats (audio streaming, podcasting) will rise +9%. Podcasting will help drive digital audio growth, and grow +16%, though this represents a slowdown compared to MAGNA’s previous forecast of +22%
Magna is using the assumption of Real GDP growth of +1.3% in 2023.
Dentsu Forecast
June 2024
- Global advertising spend is now forecast to grow by 5.0% in 2024 (vs. 3.3% in 2023) to reach $754.4 billion, as spend prospects improve in the UK, Germany, US, Japan, and France.[11]
- Digital is beating previous growth expectations and is now predicted to increase by 7.4% to capture 59.6% of global spend in 2024, with double-digit growth for retail media and paid social.
- Substantial ad spend increases are forecast for retail media (+32.0% YOY, 17.7% three-year CAGR to 2026), paid social (+13.7% YOY), and programmatic (+10.9% YOY), while paid search (+7.7% YOY) and online video (+6.7% YOY) are set to maintain strong growth.
- The US presidential election alone is forecast to account for about a third ($11 billion) of the incremental ad spend in 2024.
- In the top 12 markets,** inflation-adjusted growth is projected at 2.6% in 2024 (vs. 5.2% at current prices), as media inflation shows signs of coming down but remains high, especially for TV and sought-after digital video formats such as social video.
December 2023
Latest forecast, covering 58 markets across the globe, is that advertising spend will expand by $33.0 billion in 2024 to reach $752.8 billion. This represents a 4.6% growth year-over-year for the ad industry – much faster than the pace seen in 2023 (+2.7% vs. 2022).[12]
- Whilst the first quarter will be the slowest of the year (4.2%), growth is forecast to accelerate in the second quarter (4.9%) before peaking during the third (5.5%), supported by major sports events
- Global advertising spend at constant prices actually decreased by 0.7% in 2023.
- In 2024, advertising spend is forecast to represent, on average, 0.75% of the gross domestic product (GDP) of the countries we track, which is consistent with the average annual ad spend/GDP indicator observed in the last 20 years (0.70%).
- In 2024, advertisers will spend, on average, $139 per capita across the world. It is about 75% more than what they spent 20 years ago ($80).
- Digital is expected to follow an upward trajectory to reach $442.6 billion in 2024, representing 58.8% of global advertising spend. Total display spend (including social and digital video) has grown by 6.4% in 2023to reach $220.7 billion. It is forecast to grow by 6.9% in 2024, and by a 6.5% three-year CAGR to 2026.
- In the digital space, retail media investments will accelerate the fastest with a 17.2% three-year CAGR, followed by paid social investments (12.3% three-year CAGR), especially in Asia-Pacific (21.0% three-year CAGR). Programmatic channels, that already account for more than 70% of digital ad spend, are also expected to continue growing by doubledigits (10.2% three-year CAGR).
May 2023
“The adjusted for 2023 points to continued growth, albeit adjusted marginally downwards from the 3.5% predicted in the December 2022 report, in the most part due to macroeconomic factors. Exploring behind the headlines, the report also shows growth driven by media price inflation rather than increased advertising volume, where advertising spend at constant prices is expected to decline slightly, with –0.6% reduction year on year”[13]
- Global advertising spend expected to grow by 3.3% in 2023 with inflation driving increase to reach US$727.9 billion
- Stronger growth ahead, with 2024 global advertising market now expected to increase by 4.7%, to reach US$762.5 billion, with a further 3.8% growth into 2025
- Digital is projected to settle into almost consistent incremental growth for three years, to account for around $3 in every $5 spent in advertising worldwide.
- Social spend is forecast to grow by a 12.8% three-year CAGR, driven by new platforms, social commerce, and the popularity of short-form video content across platforms such as TikTok and Instagram Reels
- Programmatic is expected to grow at a 11.0% three-year CAGR to reach a forecast 76% share of digital spend in 2025, a year-by-year analysis reveals its growth will slow (14.4% in 2023, 9.2% in 2024, 9.5% in 2025).
- Traditional radio is projected to decrease by 0.1% in 2023 whilst online radio growth is forecast at 3.6%.
Zenith Forecast
December 2023
Zenith’s latest Advertising Expenditure Forecasts reports continued resilience and forecasts 5.3% global advertising growth for 2023, which is above initial expectations given a healthier than expected Q3 for major digital advertisers.[14]
- Global adspend growth is expected at 4.8% in 2024, excluding U.S. political spending*, aided by events such as the Olympics as well as a combination of continued advertiser spending in support of their brands and the positive impact of Chinese brands fueling growth.
- The Americas are expected to continue as the fastest-growing region with 5.7% advertising growth in 2024. Europe continues to contribute meaningful growth (4.5%) due in part to online spending, while Asia-Pac (3.8%) remains impacted by China’s slower-than-expected recovery.
- Adspend momentum remains steadily on an upward trajectory in large part due to the strong adoption of online propositions such as retail media and social media. Online continues to lead as the fastest-growing category, accounting for 59% of overall spending in 2024 and expected to increase to 61% in 2026, with a CAGR of 4.6%.
June 2022
- The global advertising market will continue to maintain its resilience and Zenith forecasts a 4.4% growth in global advertising expenditure for 2023[15]
- Global adspend growth is expected to accelerate 6.9% in 2024 and 4.8% in 2025 to account for nearly $1 trillion in advertising spending in 2025.
- North America is expected to continue to provide the biggest contribution to advertising growth between 2023 and 2025 with adspend growing US $53 billion – representing 41% of total adspend during the period. A healthy growth of 4.3% is expected in 2023 and Zenith forecasts advertising expenditure will then jump to 9.8% in 2024 thanks to the Presidential election and the Olympics.
- Online, including Retail Media, Search and Social Media, will continue to lead as the fastest-growing category, constituting 57% of overall adspend in 2023. Zenith forecasts an increase to 59% in 2025, with a compounded annual growth rate of 6.8%. Retail Media will drive the category growth, with an estimated annual global spend of $129 billion in 2025 and an expected compounded annual growth rate of 11.5% from 2022 to 2025.
- Zenith forecasts a compounded growth rate of 25% between 2022 and 2025 within the Subscription Video on Demand (SVOD) space.
December 2022
According to Zenith, the advertising industry is expected to maintain its resilience in 2023 despite current economic challenges, driven by the growth of new channels such as retail media and advertising on Subscription Video on Demand (SVOD) services. They anticipate a 4.5% growth in ad spending. Furthermore, global ad spending growth is expected to pick up pace to 7.2% in 2024, driven by major events like the US Presidential elections and the Olympics.[16]
Online advertising, specifically Search and Social Media, is expected to continue as the fastest-growing category, making up 55% of overall ad spending in 2022 and projected to increase to 57% by 2025, with a compound annual growth rate of 7%.
Advertising behavior during a recession
Looking back at the 3 last recessions[17], it is clear ad budgets get cut during economic contractions, but the magnitude of the decline can vary depending on the severity of the recession, the specific industries and companies involved, and their advertising strategy.
Important to note that the advertising industry could recover quickly after crises, often reaching or even exceeding prior spending levels within one to two years post-economic downturn.
- COVID-19 pandemic resulted in a 3.7 percent decrease in ad spending in 2020 compared to 2019.
- During the Great Financial Crisis, advertising spending experienced a decrease of 9.5% in 2009
- During the Dot Com crisis, advertising spending saw a decrease of 4.04% in 2001
| Year | Ad spending in million U.S. dollars | Growth Rate |
| 2024* | 884,999 | 7.57% |
| 2023* | 822,756 | 5.36% |
| 2022* | 780,870 | 8.03% |
| 2021 | 722,843 | 16.00% |
| 2020 | 623,116 | -3.70% |
| 2019 | 647,035 | 5.43% |
| 2018 | 613,721 | 6.80% |
| 2017 | 574,640 | 6.08% |
| 2016 | 541,698 | 5.53% |
| 2015 | 513,304 | 4.60% |
| 2014 | 490,713 | 5.61% |
| 2013 | 464,668 | 4.87% |
| 2012 | 443,077 | 4.34% |
| 2011 | 424,666 | 3.92% |
| 2010 | 408,663 | 7.82% |
| 2009 | 379,036 | -9.50% |
| 2008 | 418,828 | -0.12% |
| 2007 | 419,319 | 5.60% |
| 2006 | 397,088 | 6.56% |
| 2005 | 372,646 | 5.22% |
| 2004 | 354,171 | 6.61% |
| 2003 | 332,198 | 3.01% |
| 2002 | 322,505 | 0.10% |
| 2001 | 322,182 | -4.04% |
| 2000 | 335,733 |
2022 Developments
Magna
Social media formats (Facebook, Instagram, Tiktok …) will re-accelerate +6% to $66bn after stalling in 2022 (+2%) due to headwinds including audience maturity and the data targeting limitations established in 2021.[18]
News
- After years of social media being one of the most powerful engines of digital ad spending growth, 2022 saw the first meaningful decline in social’s share of digital ad spending since Insider Intelligence began tracking it in 2008. This was, in part, due to the rise of retail media and connected TV (CTV), plus a radical slowdown in growth caused by ATT.[19]
Previously expected $33.98 billion in social network video ad spending by 2022, and that figure has now been slashed to $29.82 billion—a difference of more than $4 billion. These staggering reductions are the result of a perfect storm starting in 2021—with Apple’s rollout of its AppTrackingTransparency framework, followed by a downturn in the global economy due to persistent inflation, soaring interest rates, supply chain disruptions, and the Russia-Ukraine war.
2. Over the full year, UK social media spend, which is a sub-category of the online display section in the report, increased by 4.9%. The overall category grew at 10% in 2022 and is projected to grow by 1.7% in 2023. Total ad spend grew 8.8% in 2022.
- Sharp and sustained falls in social media spend – the first time this has been recorded in the UK – are likely to have been instigated by reduced advertising activity among the SMEs who comprise a ‘long tail’ of ad volume on social platforms and whose margins are under incredible stress as inflation bites
- The decline in the latter half of 2022 also coincides with a period of unrest within the wider social media ad landscape.[20]
3. Digital ad revenue in the U.S. rose 10.8% to $209.7 billion last year as marketers continued to spend in online channels despite slower economic growth, market uncertainty and mass layoffs at big tech companies, according to a new report from the Interactive Advertising Bureau and PricewaterhouseCoopers LLP. But the increase was smaller than the 35% leap seen in 2021. [21]
In addition to broader economic uncertainty, which led some companies to draw back on marketing budgets in the last part of 2022, the online ad business has been grappling with evolving privacy regulation and increased consumer privacy protections from companies such as Apple Inc., which some industry players say have made it harder to target messages and measure their efficacy.
Social media ad revenue grew 3.6% in 2022, a slowdown in growth from 39.3% a year earlier, according to the new IAB report, as privacy protections affected companies in the sector in particular.
“Social media, of all the different kinds of [media] types that we looked at, was the most adversely affected in 2022” as a result of tech platform policies, Mr. Cohen said.
Public Companies
2008-2009 Company Comparison
| Company | Revenue | EPS | Margin | Comments 2009 | |||
|---|---|---|---|---|---|---|---|
| 2008 | 2009 | 2008 | 2009 | 2008 | 2009 | ||
| Alphabet | To be updated here. Work in Google Sheets | ||||||
| WPP[22] | 7,476.9 | 8,684.3 | 37.6p | 35.3p |
| ||
| Publicis[23] | 4,704 | 4,524 | 2.12 | 1.90 | 16.7% | 15.0% |
|
| Interpublic Group[24] | $6,962.7 | $6,027.6 | $0.52 | $0.19 | 8.5% | 5.7% |
|
2008-2009 News and Commentary
- Us total measured advertising expenditures fell 12.3% in 2009 from 2008 levels, to $125.3 billion, according to data released by Kantar Media[25]
2. U.S. ad spending declined nine percent in 2009, according to preliminary figures released today by The Nielsen Company. Spending fell an estimated $11.6 billion to a total of $117 billion last year. The figures continue a trend of at least six straight quarters of negative growth in the ad industry[26]
There was some notable activity among product categories outside the top 10. Investment Services not only saw ad spending fall 14% to $1.3 billion in 2009, but the category also had about 1000 fewer advertisers in 2009 compared to 2008. On the other hand, spending by web-based advertisers climbed 32% to $1.1 billion, paced by dramatic spending increases by Hulu and Bing.
“Fourth quarter ad spending was down just two percent year-over-year, and that helped soften the full-year decline,” said Terrie Brennan, senior VP for new business development at The Nielsen Company. “In fact, most of the top advertisers showed increased spending late in the year. These are encouraging signs for an ad market that’s still trying to stop the bleeding.”
References
- ↑ 1.0 1.1 https://drive.google.com/file/d/1dZ1kFgBmP-B16_EBlikJUSciXDfGmEa2/view
- ↑ 2.0 2.1 2.2 https://drive.google.com/file/d/1soM8MQV1aQD8pQxkM225AR714JtniPzb/view
- ↑ https://drive.google.com/file/d/1soM8MQV1aQD8pQxkM225AR714JtniPzb/view
- ↑ https://magnaglobal.com/political-and-olympic-advertising-boost-strong-us-ad-market/
- ↑ https://magnaglobal.com/global-ad-forecast-june-2024-update/
- ↑ https://magnaglobal.com/digital-momentum-leads-ad-market-forecast-to-9/
- ↑ https://magnaglobal.com/digital-advertising-reaccelerated-in-2023-major-events-will-fuel-traditional-media-in-2024/
- ↑ https://magnaglobal.com/us-ad-forecast-fall-2023/
- ↑ https://magnaglobal.com/global-ad-market-june-2023-update/
- ↑ https://magnaglobal.com/us-ad-market-update-march-2023/
- ↑ https://info.dentsu.com/AdSpendMay2024
- ↑ https://info.dentsu.com/dentsuGlobalAdSpendForecasts_December2023
- ↑ https://info.dentsu.com/ad-spend-may-2023-pdf
- ↑ https://www.zenithmedia.com/zenith-forecasts-4-8-growth-for-2024-marking-continued-adspend-acceleration-into-2025-and-beyond/
- ↑ https://www.zenithmedia.com/zenith-reports-a-consistent-global-ad-market-with-4-4-growth/
- ↑ https://www.zenithmedia.com/zenith-forecasts-4-5-growth-for-2023-after-7-3-uplift-in-2022-marking-continued-healthy-growth/#:~:text=Zenith%20estimates%20that%20advertising%20on,are%20likely%20to%20follow%20suit
- ↑ https://www.statista.com/statistics/272443/growth-of-advertising-spending-worldwide/
- ↑ https://magnaglobal.com/us-ad-market-update-march-2023/
- ↑ https://www.insiderintelligence.com/insights/social-media-paid-ads/
- ↑ https://www.marketingweek.com/social-media-ad-spend-drops/
- ↑ https://www.wsj.com/articles/digital-ad-revenue-grew-again-in-2022-but-much-more-slowly-41485957
- ↑ https://www.wpp.com/-/media/project/wpp/files/imported-reports/2009/ar09_complete.pdf
- ↑ https://www.publicisgroupe.com/sites/default/files/press-release/20100217_Annual_Results_2009_final.pdf
- ↑ https://investors.interpublic.com/static-files/bcbb3af5-6514-4138-bc49-f67bd7800ae5
- ↑ https://techcrunch.com/2010/03/17/advertising-expenditures-2009/
- ↑ https://www.nielsen.com/wp-content/uploads/sites/2/2019/04/2009-Year-End-Ad-Spend-Press-Release.pdf