Magna forecasts global ad market to continue growth as retail and social media accelerate
IPG’s Magna unit expects the global advertising market to continue growing in 2023, boosted by retail media and social media bouncing back.
Magna’s June update to the global ad forecast is estimating revenues of media owners advertising revenues to reach $842 billion this year, up 4.6% from $805 billion in 2022. While ad spending slowed in the first quarter due to economic uncertainty and lack of cyclical drivers, ecommerce and retail media are contributing to more marketing dollars. Retail, auto and travel are also adding to the growth.
Vincent Létang, evp of global market research for Magna, noted that traditional media formats will struggle this year, and uncertainties will continue to impact the industry, including the TV writers strike.
Media formats
While traditional, editorial media companies and branding formats and TV advertising revenues will shrink this year, digital pure-play ad sales and retail media networks are expected to grow.
Digital pure-play advertising sales will increase by 8.5% to reach $577 billion dollars, accounting for 69% of total ad sales. This is driven by organic growth factors, thorough ecommerce, retail media and other media consumption shifts. Search and commerce formats remain the biggest ad formats – reaching $296 billion, up 9.1% from the previous year.
After seeing its worst year in 2022, social media formats will get “reaccelerated” this year as they increase 9.4% to reach $172 billion, per Magna. And Meta and other social media vendors seem to have recovered from its losses due to Apple’s changes to its OS in late 2021.
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