The global ad agency giant Dentsu says global ad spend for traditional and digital audio increased by 3.6% in 2022 to reach $35.6 billion. That was good for a five percent share of total global ad spend. It follows an 11.6% rebound in 2021, when the worldwide audio market recovered to pre-pandemic spend levels. Breaking down this year’s results, it estimates traditional radio ad spend increased by two percent while digital audio spend increased by 9.3% this year.
Dentsu says this year “began strongly, but a slowdown in growth was seen as the year progressed with the ad market impacted by economic uncertainty.” The Dentsu outlook says “macro-economic challenges, including rising inflation of energy, food, and fuel costs, rising interest rates, and the impact on business and consumer spending have led to expectations of slower ad spend growth.” But it says the U.S. ad market is anticipated to show 13.8% growth this year with a forecasted 3.8% boost in ad spending during 2023 and 4.9% growth in 2024.
The global audio ad market is forecast to grow two percent in 2023 to $36.3 billion, thanks to events like the Rugby World Cup. From there audio is forecast to deliver $37.4 billion in 2024 (+3.1%) and $38.3 billion in 2025 (+2.4%).
“While digital and TV now account for more than 80% of global ad spend, brands will still use print, audio, OOH and cinema for the unique opportunities, targeting and formats they can offer,” Dentsu’s forecast says. “All of these channels (bar cinema) can be a part of the digital ecosystem, with their digital elements available in omnichannel DSPs meaning they can easily be planned and bought as part of an integrated campaign. It is also important to remember where the channels’ individual strengths lie.”
The trend toward digital spending continues. Online channels are forecast to increase their share of the ad pie from 55.3% in 2022 to 58.2% in 2024, with new categories within digital, notably retail media, showing the biggest increases.
All the growth – both in 2022 and in 2023 – is coming from digital. Traditional media (linear TV, print newspapers and magazines, out of home, radio and cinema) continue to account for $261.4 billion of ad spending. Traditional media is forecast to rise just 0.3% in 2022 and decline by two percent in 2023.
Peter Huijboom, Global CEO of Media & Global Clients at Dentsu International says one reason why digital continues to deliver such strong growth is because advertisers are prioritizing performance-based ad campaigns due to “the increased business focus on immediate gains to help ride out the temporary economic slowdown.”
However, the pace of digital growth is easing up. Global digital ad spend increased by 13.7% in 2022 but is forecast to slow in 2023 to 7.2%. That’s a downward revision from 9.3% growth in Dentsu’s July 2022 report.
Download the Dentsu forecast HERE.