The economic environment is expected to remain robust in 2025 and that has Magna predicting another healthy year for the U.S. ad market. Even without the boost of an election year, the ad giant’s forecasting team predicts advertising will grow 4.9%. It says inflation posing less of a drag on consumer sales will help overcome the lack of any cyclical factors.
“With no major cyclical drivers in 2025, Magna expects ad spend growth rates to slow, but the organic factors will remain at work, stabilizing traditional media owners’ ad revenues, and growing digital pure players’ ad sales,” says Vincent Létang, Magna’s Executive VP of Global Market Research.
The continued impact of organic growth drivers will keep the global ad market growing in 2025. Magna forecasts the global marketplace to grow 6.1% to approach the trillion-dollar mark ($990 billion) while the U.S. market flirts with the $400 billion milestone.
Magna says excluding cyclical spending, U.S. ad revenue will grow 7.3% next year. The momentum will remain in the digital side of the ad market, and that holds true in audio as well. It forecasts digital audio ad spending will increase 4.2% next year, while audio ad spending overall will slip 3.2%.
With numbers similar to this year’s, the net effect is likely for a mostly steady year for audio. In 2024, Magna says the give and pull of digital and traditional audio spending resulted in an overall 1.1% increase for the U.S. audio market.
U.S. media enters 2025 with a tailwind as it comes off the strongest growth year in the ad market in a quarter-century, according to Magna, excluding the post-pandemic rebound year of 2021.
“Everything was aligned to create a favorable environment for advertising spending this year — decent economic activity, the slowdown of inflation, several innovations in media and tech made advertising more attractive than ever for brands,” Létang says. “And on top of that, there was an exceptional combination of major cyclical events driving marketing activity.”
The forecast update reveals overall U.S. ad spending will reach $380 billion in 2024. It says total ad spending grew 12.4% this year, and when cyclical events like the Olympics or the elections are factored out, spending still increased 9.9% year-to-year.
“It was a very strong year for the U.S. ad market,” says Létang, who authored the report. “This was the strongest annual growth in 25 years — with political advertising generating $9 billion of incremental ad revenues, and the Olympics generating $1 billion of extra ad sales.”
Growth went beyond the U.S. borders. On a global scale, media owners’ ad revenues reached $933 billion in 2024, up 10%. And Magna calculates global audio ad revenues grew by 2% to $29 billion this year as many advertisers found the media less busy and costly than television, and digital audio like podcasting continued to grow in popularity.
Magna says advertising revenues of traditional media owners, including radio, grew by an estimated 4% to $274 billion worldwide this year. That is the best performance in 14 years for traditional media, excluding the post-COVID recovery of 2021.
“The strong growth of advertising spending in 2024, despite a challenging economic environment, was of course driven by an unusually high number of major cyclical events but, more fundamentally, media innovation is what attracts a growing share of marketing budgets into advertising formats,” Létang says. The report says traditional media like radio, TV and publishers are “successfully” developing non-linear ad sales successfully.
Magna Senior Analyst Rebecca Hwang says that strength in this year’s ad market was driven by a slowdown of inflation. “Several large verticals were particularly dynamic in 2024,” she says, pointing to a 26% increase in personal care and beauty ad spending and 10% year-to-year increase in finance and travel advertising helped by lower interest rates and pent-up demand for travel. Magna also says technology, which declined in 2023 and languished in the first half of 2024, finally came alive in the second half as tech companies ramped up massive ad campaigns to support AI-powered products.
“Auto advertising was also strong in 2024 due to the competition between legacy and electric brands,” Hwang says. But Magna says the auto market remains in flux with several manufacturers struggling. Several governments are looking to scale back on EV subsidies in 2025, including in the U.S.
“The car market may suffer again next year, forcing auto brands to reduce marketing spending. As a result, auto has high potential but with multiple headwinds,” the report says.
Magna says the U.S. is not only the largest ad market in the world, representing 40% of global ad spending, but is also the most “intense” as measured by the ratio of ad sales per capita. The 2024 U.S. ratio reached $1,129, which means advertisers collectively spend more than $1,000 to reach each U.S. consumer in 2024. That is seven times the global average of $161.
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