The news: The worldwide advertising outlook for next year isn’t as dismal as some have feared, with WPP media investment arm GroupM forecasting a 5.9% increase and IPG Mediabrands’ Magna anticipating 4.8% growth.
A look back: GroupM published the figures in a year-end report, where it also projected worldwide advertising investment would increase by 6.5% in 2022, excluding the (lucrative) US political ads market.
Bright spots: Many big advertisers are still growing revenue, suggesting they will continue to spend. Moreover, unemployment is still low by historical measures.
Digital deceleration: Investments in digital advertising are still increasing more quickly than overall ad investments, but they’re expected to slow. Insiders shouldn’t be surprised by this, since digital expenditures now account for the bulk of total ad spending.
Analyst insight: “Even in an economy facing serious headwinds, the global ad market is showing resilience heading into 2023,” said principal analyst Paul Verna. “We are in difficult, uncharted times, and some sectors of the ad economy, like social, are faring worse than others. But overall, recent forecasts should give ad buyers, sellers, and intermediaries a measure of hope.”
Our take: Deceleration is not the same as decline, and the aforementioned estimates show that the advertising sector will remain relatively strong even during a recession.