WARC downgrading ad growth forecast

 Global advertising investment 2023 will be USD 880.9 billion, marketing company WARC Media predicts. The forecast means a reduction of USD 90 billion of growth potential explained by the digital slowdown.

“The coming 12 months may usher in a new pattern for global advertising investment. Against a backdrop of economic crises, geopolitical complexity, spiralling inflation, supply chain disruption, and structural technology shifts, marketers are re-evaluating their approach”, the forecast says. 

TikTok’s advertising revenue is forecast to grow 42% in 2023 and is top choice for increased investment by 76% of WARC’s Marketers Toolkit survey respondents, around 1 700 marketers globally.

“Media and audience fragmentation are of concern for 34% of survey participants. The media industry is under pressure to reform to address the impact of advertising on climate change, supporting DEI, and talent crisis.”

Retail media is fourth-largest medium by ad spend and is on course to becoming more valuable to advertisers than linear TV in 2025, the forecast says.

“To attract advertising revenue, Big Tech companies are branching out. Meta is pushing for engagement with the metaverse and Snap is investing heavily in augmented reality. TikTok continues to attract investment – its ad revenue is forecast to grow 42% in 2023. However, WARC forecasts pureplay internet ad growth this year at just 5.5%, down from 42% in 2021.”

“While the breakneck speed of growth in ad investment witnessed in 2021 could never have been maintained, media owners like Meta alongside brands and agencies are also challenged by other fundamental issues. From cleansing the ecosystem of misinformation, using ad dollars to promote greater diversity and inclusion, attracting and retaining the right talent, to saving the planet from catastrophic climate change”, says Alex Brownsell, Head of Content at WARC Media.