Brands will continue to invest in advertising in the second half of the year, but warc expects a slowdown in 2023.
Ad spend around the globe will rise 8.3% in 2022, before slowing significantly in 2023 – in a major new report, WARC downgrades expectations for global ad market growth by $90bn in the face of a wider economic slowdown. These are the figures presented in WARC’s Ad spend Outlook 2022/23: Impacts of The Economic Slowdown. You can read a sample here. WARC Media subscribers can access the full report here.
The report notes following facts:
Global ad spend is set to reach $880.9bn this year – a rise of 8.3% or $67.3bn. This is largely down to cyclical boosts from major events like the US midterm elections and the men’s FIFA World Cup, both taking place in November, which will animate H2 growth. Big brands appear to plan to sustain their spend.
However, growth is set to slow significantly to just 2.6% in 2023. WARC is thus cutting its original 2023 outlook from last December by 5.7 percentage points. A significant reduction in investment is also estimated for social media. Investment in social media advertising is set to grow by 11.5% this year, but this is well below the 2021 figure (+47.1%). In 2023, it is set to grow by just 5.2%, the lowest ever for this category. Apple's privacy measures are also expected to play a role. This also applies to YouTube, where advertising investment is expected to increase by 5.6% in 2023.
Investment on ad-supported video platforms (AVOD) is expected to increase slightly faster. Broadcasters are also expected to see an increase in advertising revenues this year (+9.7%) and 5.2% next year. Higher revenues are also expected for linear TV this year (+3.6%), but a decline of 4.5% is forecast for next year.
"With the rate of growth in global output now halved and supply-side pressures fuelling inflation, the economic slowdown has slashed nearly $90 billion from the global advertising market's growth prospects this year and next," notes James McDonald, Director of Data, Intelligence & Forecasting, WARC. But he adds that brands are still investing for now as the post-Covid recovery continues.
Source: mediaguru.cz
