US ad market sees 14% growth in July, marking 15th consecutive month of expansion

The news: The US advertising market kicked off the third quarter with impressive growth, with spending in July increasing nearly 14% year over year (YoY), according to Guideline’s latest US Ad Market Tracker. This significant uptick contrasts sharply with the same month in 2023, which saw a 7% rise.

• The recent data suggests that the ad market’s double-digit gains aren't just a result of easier YoY comparisons but reflect genuine growth.
• This marks the 15th consecutive month of expansion, making July 2024 the strongest month for the US ad market since it emerged from a brief contraction.

This comes on the heels of digital advertising outperforming our forecasts at mid-year, with Google and Meta maintaining their dominance, though smaller platforms like Pinterest and Snap faced challenges. CTV and retail media also grew, with Roku and Walmart showing strong gains, though competition remains fierce.

Yes, but: Despite such a long streak of ad market growth, industry optimism is low due to multiple existential crises: tightening budgets, the decline of ad-tracking capabilities, AI displacing jobs, and the rise of generative AI and social media search threatening traditional search engines like Google.

Consumers are showing signs of strain as the labor market weakens, credit card delinquencies rise, and their confidence falters. The Fed’s delayed interest rate cuts may have worsened conditions, leading to cautious spending and a challenging economic landscape.

Why it matters: The robust growth in July indicates that advertisers may be regaining a measure of confidence. This momentum suggests that brands are willing to invest more heavily in advertising, despite market uncertainty—especially with an interest rate cut expected next month.

Our take: July’s robust growth in the US ad market is a promising sign, but it's not time to declare victory just yet. While the YoY increase is certainly encouraging, it’s essential to consider the broader economic context.

• The long-term outlook remains uncertain due to potential economic slowdowns and election-year volatility, raising questions about whether these figures are leading indicators of continued strength.
• If July’s ad spending data is part of a trend—and the 15-month streak implies that it is—then the rest of 2024 could be a prime time to invest, though flexibility will be needed if the market shifts.