As we hit the midpoint of November, we’re reaching the start of prediction season, where people across the industry cast their thoughts to the coming year and speculate about the trends and challenges likely to impact the industry in the year ahead.
VideoWeek will be running our annual CEO predictions article later in the year, but a good place to start when judging what to expect for 2024 is quantifiable data, found in the various industry ad spend forecasts put out by analysts and agencies.
So what do these forecasts say the year ahead has in store for us?
Growth, but how much?
As the above graph shows, forecasts from GroupM, Magna Global, Zenith, and Dentsu all agree that global ad spend will be up next year, by a single digit percentage. Similarly the AA and WARC, whose figures cover the UK only, predict single digit percentage growth.
But there’s fairly wide variation within their figures. Zenith’s forecast is the most optimistic for 2024, forecasting global ad spend growth of 7.2 percent, while Dentsu’s is the most conservative global figure, predicting 3.9 percent growth.
One thing to note is that this variation isn’t wholly down to different expectations about the state of the economy and advertisers’ spending plans for 2024.
There’s significant variation in full year predictions for 2023, with GroupM forecasting 5.9 percent growth this year, and Dentsu predicting 3.3 percent growth. But these predictions all incorporate each company’s real measured data on ad spend for the year so far (up to the point when each of these forecasts was released, which varied). The fact that variation is high, despite 2023 predictions containing data for at least the first half of the year, suggests that at least some of this variation comes down to discrepancies in how each company calculates total ad spend, or the base data they’re looking at.
Regardless of their predictions for 2023, all of the above were aligned in projecting that growth in 2024 will be higher than it was in 2023. But again, the size of this change is debated. GroupM predicts 2024 growth of 6 percent, just 0.1 percentage points higher than its 2023 forecast of 5.9 percent. At the other end of the spectrum, Zenith expects global ad spend growth of 7.2 percent next year, 2.8 percentage points higher than its 2023 forecast of 4.5 percent. Magna, Dentsu, and the AA/WARC all sit in the middle.
Events of 2023 haven’t dampened expectations
Another interesting trend, comparing each of these companies’ most recent predictions for 2023 and 2024 with their previous forecasts, is that while forecasts have generally been revised downwards, the extent of this has been small. This is perhaps surprising, given how agency financial results across the year have generally come in lower than expected (outside of Publicis).
Starting with GroupM, the WPP media arm predicted 5.9 percent growth for 2023 and 6.2 percent growth for 2024 in its forecast released at the end of last year. It’s mid-year forecast this summer was largely the same, with 2023 unchanged, and 2024 expected growth revised down by just 0.2 percentage points.
Downward adjustments to forecasts elsewhere have similarly been slim. Comparing their most recent releases with predictions made at the end of last year, Zenith’s 2023 forecast was cut by just 0.1 percentage points, Magna’s was cut by 0.2 percentage points and Dentsu’s was cut by 0.2 percentage points.
Meanwhile for its 2024 forecast, Manga actually raised its projection in its most recent release, for 5 percent to 5.6 percent growth (excluding cyclical factors).
What to expect for 2024?
As the figures show, there’s no neat consensus on growth for next year, but there is a broad consensus on some points:
Global ad spend will have grown by a single figure percentage this year. Growth next year will be higher than this year, even not accounting for cyclical factors like political advertising in the US. And events throughout 2023 haven’t done too much to shake 2024 predictions (though it’s worth noting that most of these forecasts were released before the latest outbreak of fighting between Israel and Palestine, which might have an impact on future forecasts).
