Dive Brief:
- Global ad spending will be more robust than previously anticipated in 2025, with full-year growth now expected to increase 7.4% to $1.17 trillion, according to a Q3 update from WARC.
- The upward revision, the first WARC has issued in over a year, marks a 1.2 percentage-point jump from prior estimates published in June. Driving momentum are digital-first ad platforms, which will snap up nine in 10 dollars of incremental market growth, and what WARC described as a “pre-tariff windfall.”
- Social media is attracting a plurality of new ad dollars at 40.6% market share, while non-retail search and retail media will take up 22.2% and 21.5% of spend, respectively. Just three companies — Google owner Alphabet, Amazon and Meta — are positioned to take over half (55.8%) of global ad spend this year, excluding China.
Dive Insight:
As other industry watchers slash their ad-spending outlooks for 2025, WARC foresees more robust growth than anticipated just a few months ago. The researcher’s Q3 report, which takes a global versus U.S.-specific view, highlights how the digital triopoly of Amazon, Google and Meta continues to entrench its dominance amid a period of deep economic uncertainty. The findings also indicate that marketers enacted a blitz of activity in the second quarter, a “pre-tariff” period where many brands rushed to stockpile inventory and promote value ahead of expected price hikes.
On the latter point, social media spending spiked 20.2% year over year in Q2, well above prior projections of 12.4% growth and the equivalent of about $4.9 billion in additional value. WARC tracked “sharp” increases in spending from retailers on social media in Q2, with the category pouring more dollars into Meta-owned Instagram (18.8% growth) and TikTok (56.8% growth), whose future in the U.S. is still being sorted out. Retail is now the largest category on both of those platforms, per WARC monitoring assisted by Nielsen. Technology and consumer electronics, other verticals vulnerable to tariffs, recorded notable lifts in spending on those sites as well.
“Despite economic headwinds, including disruption to global trade and reduced purchasing power among consumers, brands are doubling down on Meta, Alphabet and Amazon, while emerging players like TikTok are growing fast but from smaller bases,” said James McDonald, director of data, intelligence and forecasting at WARC, in a statement. “The global market is set to nearly double in value since the pandemic, underscoring the resilience of advertising in a tougher economic climate.”
Retail media is on track to grow 13.7% in 2025, achieving $175 billion in spend, or a 14.9% share of the total global market. Like other pockets of digital, just a few companies loom large in retail media, with Amazon primed to account for over a third (35.4%) of its advertising pie. That said, retail media’s upward climb is set for a “marked slowdown,” with an average rate of growth of 12.6% over the next few years.
By contrast, traditional media channels, including newspapers, broadcast TV and radio, remain on the wane. A big upshot from WARC is that digital has firmly entrenched itself as the leading advertising engine in the post-pandemic world despite repeated fits of macro volatility. The firm estimates that the nominal value of the global ad market will effectively double by 2027 compared to 2020 figures, reaching about $1.36 trillion.
Not everyone is as optimistic about 2025’s prospects as the impact of tariffs are more strongly felt by brands. U.S. automotive and retail spending on digital ads is sharply retreating due to the trade war, eMarketer said in a report published earlier this week that somewhat conflicts with WARC’s assessment. Total digital spending in the U.S. is forecast to grow 9.5% YoY to $338.27 billion, per eMarketer, a revision two percentage points lower than earlier estimates.
Informa, which owns a controlling stake in Informa TechTarget, the publisher behind Marketing Dive, is also invested in WARC. Informa has no influence over Marketing Dive’s coverage.
