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2022-09-02![Advertisement spending Advertisement spending](https://varindia.com/storage/news/uploads/2018/02/6311caae81800.jpg)
The global advertising market will rise 8.3% in 2022, before slowing significantly in 2023. In its latest report by WARC, a provider of marketing insights, downgrades its expectations for global ad market growth by $90 billion (90.4bn Euro) in the face of a wider economic slowdown.
The Growth in advertising market is expected to slow significantly to just 2.6% in 2023: The new projections, based on data from 100 ad markets worldwide, amount to a downgrade of 4.3 percentage points to 2022 growth and 5.7 percentage points to 2023’s prospects, compared to WARC’s previous global forecast in December 2021 – a reduction of close to $90 billion in potential growth over the two years.
With the Social media’s $40bn shortfall amid slowing growth WARC expects the impact of Apple’s privacy measures on social media companies that rely on cross-site tracking will be in the region of a $40 billion hit to their bottom lines over the course of this and the coming year. Most are expected to see far less growth than they are used to over the forecast period. Overall, social media is expected to rise 11.5% in 2022 (compared to +47.1% in 2021) before cooling to just 5.2% – its slowest ever period of growth.
Meta recorded its first annual decline in advertising income during Q2 2022 and WARC believes its full year growth will be flat over the forecast period, as the Instagram platform stymies ongoing losses from the core Facebook platform this year and next.
YouTube’s fortunes have also proven vulnerable to privacy changes on Apple devices; WARC believes that YouTube’s advertising revenue will rise 7.3% this year (compared to +45.9% in 2021), but that its growth will then ease to 5.6% in 2023.
With the growth rate of global output now set to halve and acute supply-side pressures fanning inflation, the economic slowdown has removed close to $90 billion from global ad market growth prospects this year and next”. Economic uncertainty and block on third-party cookies will lead to a slowdown, according to WARC, as it downgrades previous expectations.
Yet brands are still spending as the Covid recovery continues, and global ad trade remains on course to top $1 trillion in value by 2025. Platforms with rich sources of first-party data – most notably Amazon, Google and Apple – are well placed to weather future headwinds by offering measured performance in a climate where return on investment becomes paramount.
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