December 6, 2021 by Michael Bürgi
The latest global ad revenue forecast from WPP’s GroupM is out — and if it’s accurate, media is going to have a pretty great 2022.
Brian Wieser, GroupM’s global president of business intelligence, and a longtime prognosticator of media fortunes, revised his 2021 global ad revenue forecasts upward from 19.2 percent growth back in June to 22.5 percent. Wieser also bumped up his 2022 ad revenue forecast from 8.8 percent back in June to 9.7 percent. Both numbers exclude U.S. political advertising.
Finally, Wieser predicts that total ad expenditures on the media he tracks — TV, digital platforms, OOH, audio, cinema and print (newspapers and magazines) —will surpass $1 trillion by 2025, from its current $766 billion. “The pandemic kind of changed a few things,” said Wieser. “The catalyst for growth that’s come from it is remarkable.”
The main drivers behind Wieser’s more bullish estimates, based on the ad revenue the above-named media generate, include the emergence of new marketers that include DTC companies but also small businesses flush with low-interest rate investments from venture capital firms. “They’ve raised in some cases billions of dollars and then deployed hundreds of millions on advertising,” he explained.
Digital’s share of the global ad revenue total amounts to 64.4 percent, up from 60.5 percent in 2020, according to the GroupM report. Among them, Facebook, Google and Amazon secured between 80-90 percent of that digital ad revenue (not including China).
“The 25 largest sellers of advertising in 2016 went from 46 percent share of all advertising to 66 percent in 2020,” noted Wieser, largely due to that digital triumvirate.
Specifically in the U.S., the prediction is just as bullish, with Wieser increasing ad revenue growth in 2021 to 22.7 percent, up from June’s forecast of 17.3 percent. The growth rate for 2022 is a healthy 14.6 percent.
The single biggest driver of 2021 growth is digital, which Wieser bumped up to 39 percent, up from 29 percent in June — accounting for 60 percent of total U.S. ad revenue, up from 54 percent in 2020.
Wieser forecasts U.S. TV revenue growth in 2021 at 4.1 percent, but a more robust 6.2 percent for 2022, fueled in part by what’s expected to be a banner year for political advertising next year thanks to congressional and gubernatorial races.
Audio is also expected to grow at healthy rates, at 18.2 percent in 2021 and 9.3 percent in 2022. The same can be said for OOH, growing at 15.8 percent in 2021 and 21.8 percent in 2022. That said, Wieser expects both those areas to settle back to single-digit growth in subsequent years.