Ad forecasts cut as Trump tariffs trigger marketing uncertainty

The news: As President Donald Trump announced sweeping tariffs on all imports—upending expectations across industries and prompting widespread unease among marketers—advertising growth projections for 2025 are being cut back sharply.

• Our revised estimate now puts US ad spend growth at 6.3%, down from 7.5% in November.
• Madison & Wall lowered its forecast to just 3.6%, while Magna and WARC each trimmed their global and domestic outlooks. The latter shaved nearly $20 billion from its global ad growth forecast through 2026, citing “mounting uncertainty.”

According to the Interactive Advertising Bureau, 94% of US advertisers are worried about the impact of tariffs, and 45% plan to reduce their budgets.

• Retail and consumer electronics brands are preparing the largest cuts, followed by media, entertainment, and automotive categories.
• Social and traditional media are forecast to suffer the biggest pullbacks, though channels like digital display, gaming, and podcasts may also see slowdowns.
• Q2 and Q3 are expected to be the most volatile periods, as economic indicators shift and tariffs take effect.

Budgeting for uncertainty: The lowered ad forecasts reflect deeper anxieties about inflation, spending power, and global trade disruption. Forecasting analyst Andrew Spink highlights one of the most immediate concerns: the US must refinance $9 trillion in debt in the near term. If interest rates aren’t lowered fast enough, consumer activity could be hit hard—or worse, a full-blown recession may unfold.

• Tariffs exacerbate this tension. With new duties raising prices across product categories, brands anticipate tighter margins and more cautious consumers.
• 91% of consumers say they’re planning to shift their buying behavior due to inflation and trade costs, per the IAB.
• Even digital—which continues to take a bigger slice of the pie—isn’t insulated. Madison & Wall projects digital ad share will hit 79% by 2030, but growth is slowing.
• YouTube is expected to face downward pressure on CPMs, according to MoffettNathanson, as the connected TV ad market becomes saturated and supply outpaces demand.

Embracing flexibility: This isn’t simply a period of pullback—it’s a reordering of priorities.

• Advertisers are moving toward performance-based channels that can deliver measurable results and adapt in real time.
• The need for flexibility is echoed across media deals, with many brands demanding more lenient terms that allow for budget shifts or pauses mid-campaign.
• Traditional media, especially linear TV, faces a more uncertain road.
• Sports programming remains a relatively bright spot, but entertainment companies heading into Upfront season will need to lean heavily on live events and proven franchises to secure commitments.

Our take: Marketers who can stay agile, build contingency plans, and focus on value-based messaging are more likely to come out ahead.

• Brands that show clear, practical benefits and maintain visibility in smart, cost-effective ways will fare better than those that simply disappear.
• Tariffs may dominate headlines, but 2025 will belong to brands that prioritize clarity, adaptability, and performance over sheer spend.