After the overall negative impact that the pandemic had on global ad spend in 2020, last year witnessed a strong rebound with double-digit growth in spending. Furthermore, data [news release] from Zenith indicates that the global ad market will continue recovering into 2022. Here’s a look at the ad spending forecast for the year and how things fared in 2021.
Zenith estimates that global ad spending grew by 15.6% year-over-year (y-o-y) in 2021. The estimated $705 billion in total ad spend in 2021 is an increase from the pre-pandemic $634 billion seen in 2019. Other data from GroupM forecasts that total global ad spend will surpass $1 trillion by 2025.
Digital Ad Spend On the Rise
Looking ahead to this year, global ad spend is expected to grow by 9.1% y-o-y. And, while digital advertising was expected to account for more than half of total ad spend last year, GroupM’s data shows that it actually accounted for 64.4% of total advertising expenditures in 2021. Furthermore, Zenith forecasts that digital ad spend will grow by 14% y-o-y this year. That’s up from the 10% Zenith originally forecast back in July 2021.
As the predicted fastest-growing advertising channel in the next few years — forecast to grow an average of 14.8% yearly between 2021 and 2024 — social media ad spend is estimated to reach $177 billion this year and $225 billion by 2024. By 2024, social ad spend is estimated to account for more than one-quarter (26.5%) of all advertising dollars.
This growth is not surprising considering that research from Sprout Social shows that not only do a majority of consumers agree that social media enables them to interact with brands, but many have also increased their use of social media to interact with brands.
Online video ad spend is also expected to see double-digit annual growth between 2021 and 2024. Zenith estimates online video will see an average annual growth rate of 14%. By comparison, the average annual growth rate of paid search for the same period is expected to be 9.8%.
TV Global Ad Spend Growth to Be Considerably Slower
On the traditional media side of things, out-of-home ad spend is expected to see 7.4% annual growth, while radio advertising is expected to experience an annual growth rate of 2.2% between 2021 and 2024. On the other hand, print will see ad spending decrease annually at an average of 4.7% during that period.
Although advertisers have invested much of their spending on TV for many years, TV is forecast to see an average growth rate of merely 1.4% between 2021 and 2024, rising from $171 billion to $178 billion during that time frame. As a result, social media will overtake TV advertising in size this year, per Zenith’s forecast.
In the meantime, connected TV (CTV) advertising is seeing growth both in the US and globally. GroupM estimates CTV will account for about 10% of total TV advertising this year. Moreover, with CTV consumption accounting for close to one-quarter (24%) of total TV consumption in the US, GroupM’s data shows that global CTV advertising revenue will continue to grow in the years to come, reaching an estimated $26.8 billion in 2024.
The full GroupM report can be found here.