Global ad spend is expected to surpass $1 trillion this year, and reach $1.1 trillion next year, according to GroupM’s aptly titled ‘This Year Next Year’ report. The figures represent a 9.5 percent year-on-year increase for 2024, then 7.7 percent growth in 2025. The WPP media arm observed that advertising “has seemingly defied expectations of a slowdown” over the past 12 months, even excluding political ad spend which is not factored into the figures.
However, GroupM pointed to changing market forces creating advantages for a handful of companies. The lion’s share of ad spend remains concentrated within five corporations, with Google, Meta, ByteDance, Amazon and Alibaba projected to earn more than half of all ad revenue in 2024. “Most of this year’s growth will directly benefit the largest sellers of digital advertising,” according to GroupM. Meanwhile consolidation in the digital economy is creating competition, but only “between the same handful of players who have the resources and scale to compete.”
Digital climbs but faces legal pressures
Unsurprisingly that digital segment accounts for the vast majority of ad spend. Pure-play digital advertising is forecast to make up 72.9 percent of total spend in 2025, rising to 81.7 percent when including digital extensions of traditional advertising (such as streaming TV, digital out-of-home (DOOH) and digital newspaper and magazine revenue).
Most of the pure-play digital spending comprises social media and online video platforms, including TikTok and YouTube. GroupM forecasts this category’s growth to decelerate slightly over the next five years, “but remain faster than advertising as a whole.” The report also highlighted several legislative proposals that could shape the social landscape in the year ahead, including Australia’s social media ban for under-16s, the US potentially banning TikTok in January, and Canada’s order for TikTok to close its offices.
The report noted that while there is no clear alternative for the flow of ad spend towards these platforms, Meta and YouTube are the “clear beneficiaries” of a TikTok ban in the US. Age restrictions on Instagram and other social media apps could also lead to increased spend on gaming, music and streaming TV, according to GroupM, as ways to reach younger audiences without being tied to the volatile regulatory environment.
Search is not dead
But while the most sweeping changes to the social media landscape will stem from regulation, GroupM expects the biggest impact on Search to come from AI. Regardless of the outcome of the US Department of Justice’s lawsuit against Google, the media unit predicts competition for global ad revenues to remain “relatively stable among a group of already large sellers of advertising: Meta, Microsoft, Google, and Amazon.”
AI on the other hand is expected to create additional advertising streams, as tech giants seek to monetise their AI tools, which are costly to develop. The report notes that Google’s capital expenditure is on pace to increase nearly 60 percent in 2024 compared to 2023. GroupM forecasts further consolidation as a result, with new entrants such as Perplexity facing challenges in competing against the likes of Microsoft and Google.
Search has already seen a boost from AI summaries and overviews, according to the report, forecasting 10.1 percent growth in 2024 and 7.8 percent in 2025. GroupM notes that this growth comes in spite of “numerous headlines postulating that ‘search’ is dead or that search has ‘moved’ to social, video and retail platforms”.
Retail media to overtake TV
The report also cited retail media as a key growth channel for next year. Retail media spend is expected to overtake total TV revenue (including streaming) next year, reaching $176.9 billion in 2025, accounting for 15.9 percent of global ad spend.
Meanwhile ad spend on video streaming is on track for 19.3 percent YoY growth in 2025. GroupM forecasts that global streaming ad revenues will represent 37.5 percent of total TV revenue by 2029. But the transition is ahead of the curve in the US, where streaming revenues are predicted to overtake linear TV revenue in 2029.
There was less good news for print publishers, whose total ad revenues (including digital formats) are forecast to decline 4.5 percent in 2024 and 3 percent in 2025. By 2029, publishers will account for just 3 percent of total ad revenue, down from 35.1 percent in 2009.
“Competition and the increasingly digital and AI-driven nature of our world means that there may be good opportunities at the top of the pile (as a scaled and more nationally or globally focused media owner) and at the other end of the spectrum (as a specialist or niche player with a small and focused clientele),” said the report. “Those in the crowded ‘middle’ are more likely to have shut down print editions or shut down altogether.”
