WARC Global Ad Outlook: Growth Cut As Trade Hesitations Linger.

Global advertising spending is on course to grow 6.2% this year to $1.16 trillion, according to a second-quarter update from the World Advertising Research Center (WARC) — a downgrade of half a percentage point from WARC’s March forecast.

The global platform and advisory service cites growing market volatility as an explanation for the downgrade, with key sectors including retail (-6.1%) and automotive (-4%) poised to reduce ad spending in 2025. WARC says ad-spend growth across technology and CPG brands is muted vs. previous rates.

“The latest downgrade is attributable to a reticence to commit ad budgets across key markets in the second quarter,” says James McDonald, Director of Data, Intelligence & Forecasting, WARC, and author of the research. “This cooling is underpinned by tariff trepidations and ebbing business and consumer confidence, prompting advertisers to front-load budgets and reallocate spend geographically, particularly towards Canada, Australia, and Europe.

“Trade tensions are forcing major sectors to rethink their ad strategies,” McDonald continues. “Automakers are cutting back amid rising costs and a pivot to performance media, while retailers tighten budgets as tariffs squeeze margins. Tech firms face growing uncertainty despite continued investment, and CPG brands are leaning into retail media as supply chains come under pressure. Across the board, agility is the new imperative.”

Among other findings:

• Search to account for more than a fifth (21.5%) of the ad market this year, with spend rising 7.4% to $248.6 billion despite regulatory threats.

• Social media, the largest single advertising medium globally, is poised to account for a quarter (25.8%) of all ad spend this year, at a total of $298.3 billion.

• Retail media set to be fastest growing advertising medium this year (+14.4%), though trade disruption threatens ad receipts from consumer packaged goods (CPG) brands.

• Pure play internet — encompassing social media, retail media, online display, online classified and paid search — grew 11.5% in Q1 2025 to $195.2 billion, equivalent to 70.8% of all global ad spend. The growth rate is expected to ease to 9.9% during Q2 and 8.9% over H2 2025 to an annual total of $829.2 billion (+9.8% vs. 2024).

WARC’s latest forecast suggests the U.S. ad market will grow 5.2% this year to $451.6 billion, half the growth rate recorded in 2024 (+13.5%) and representing a 0.5-point downgrade from WARC’s March forecast. The U.S. ad market — the largest worldwide with a 39% share — faces major headwinds including tariff uncertainty, disrupted supply chains, lower consumer demand and stagflation.

The automotive industry invested $56.8 billion in advertising in 2024 with 22.9% going to premium video formats. However, budgets are shifting from video toward digital platforms, with automotive spending on social ads surpassing linear TV for the first time in 2025.

Despite WARC’s projected 4% cut in automotive advertising spending this year — an improvement on the 7.3% originally projected in March — the sector should rebound next year with a 7.5% rise pushing spending to $58.6 billion.

Retail, with projected ad spending of $166.1 billion this year (14.3% of the global ad market), faces a fall of 6.1% from 2024 levels. The tech and electronics sector is expected to spend $90.3 billion on advertising this year. This year-over-year rise of 5.5% represents a cut from WARC’s +6.2% forecast in March and is a sharp slowdown from the 24.3% rise recorded last year.

WARC expects core CPG sectors, such as soft drinks (+7.1%), toiletries & cosmetics (+7.2%) and household & domestic (+4.2%) to record growth in advertising spend at a global level this year, though all see a significant slowdown from 2024. Taken together, the CPG sector is expected to increase advertising spending 6.7% this year to a total of $200.5 billion.