Dive Brief:

• Dentsu released a revised global advertising forecast and now expects ad spend to grow 5% in 2024, up from 4.6% in a previous forecast, for a total of $754.4 billion worldwide, the advertising holding company said in a press release.
• Following a strong start to the year, spend during the remaining months is expected to be fueled by a buoyant digital advertising market, the Olympics and the U.S. election.
• Digital advertising spending is expected to increase by 7.4% and capture 59.6% of the market this year. Double-digit spend growth in the retail media and paid social categories, up 32% and 13.7% year-over-year, respectively, will help drive overall digital growth.

Dive Insight:

Adjusted for inflation, overall ad-spending growth is projected at 2.6% in 2024, as prices remain high, especially for TV and digital video formats, though there are signs that prices are coming down. Dentsu revising up its forecast to 5% growth in 2024 would see the year outstripping 2023’s 3.3% growth and beating the pace of overall economic growth by 1.8 percentage points.

Reasons for the upward revision include that the year started at a faster pace than previously anticipated, and the second half of the year, which will also include the Summer 2024 Olympics as well as the U.S. presidential election, will draw even more attention, according to Will Swayne, Dentsu’s global president of media. The U.S. presidential election alone is expected to account for roughly a third ($11 billion) of incremental ad spending in 2024.

Digital is projected to be the fastest-growing channel, accounting for $449.3 billion in total ad spending, fueled by increases in retail media (up 32%), paid social (up $13.7%) and programmatic (10.9%) channels. Paid search and online video should see strong growth as well as 7.7% and 6.7%, respectively.

Television spending is on pace for more modest growth of 2.6%. The growth will largely be driven by connected TV spending (up 24.2% year-over-year) as streaming platforms ramp up ad-supported offerings. Broadcast television is expected to decline 0.4% year-over-year.

Out-of-home and cinema spending could see modest growth of 4.2% and 4.8%, respectively. However, audio is likely to remain relatively flat with a 0.4% year-over-year increase. The only category forecast to see a significant decline is print, with an expected drop of 2.6%.

By region, the Americas is predicted to experience the fastest growth, up 5.9% year-over-year (vs. 2.2% in 2023). Asia-Pacific could see 4.2% growth, led by increases in China and India (4.8% and 6.8%, respectively). EMEA is expected to grow 4%, with forecasts revised up for its three biggest markets: the United Kingdom (up 6%), Germany (up 3.4%) and France (up 4%).

Travel and tourism will top category growth, up 8.1% as tourism continues to benefit from a post-pandemic rebound. Media and entertainment is expected to grow 6.5% as the proliferation of content and streaming services continues.