KEY TAKEAWAYS

1. The summer update of MAGNA’s “Global Ad Forecast” published Monday June 17 predicts that global media owners’ advertising revenues will reach $927 billion this year, growing by +10%.
2. MAGNA is raising its 2024 growth forecast following a stronger-than-expected ad market in the first quarter (+12%) and an improvement in the economic outlook (real GDP growth +3.2%, US +2.5%).
3. The advertising revenues of traditional media owners (TMO) – from the television, radio, publishing, and out-of-home media industries – are expected to grow to $272 billion, a +3% increase that represents a noticeable improvement compared to 2023 (-4%).
4. TMO ad sales are driven by a record number of cyclical events and a +11% growth in TMO’s non-linear ad sales (e.g. ad-supported streaming +18%) that are now accounting for one quarter of total TMO ad revenues.
5. The advertising sales of Digital Pure Players (DPP) will increase by +13% to reach $655 billion.
6. DPP ad sales are boosted by increased competition in ecommerce (e.g., Temu and Shein targeting European and American consumers), the rise of retail media networks ($146 billion this year), and better monetization of short vertical videos in video apps and social media apps.
7. Keyword Search remains the largest digital ad format, growing by +12% to reach $330 billion this year. Social Media owners (e.g., Meta, TikTok) accelerate (+18% to $212bn), while short-form pure-play video platforms (e.g., YouTube, Twitch) grow by +14% to reach $78 billion.
8. Among the most dynamic ad markets this year: Spain (+14%), India and the UK (both +12%), France and the US (both +11%). Germany and China are both experiencing economic difficulties and slower-than-average advertising spending (both +8%).
9. The US ad market will grow by +10.7% this year to $374 billion. Traditional Media Owners ad sales will grow by +4.4% to $111 billion while DPP ad revenues will expand by +13.5% to $263 billion.
10. Automotive and CPG/FMCG brands will be among the fastest-growing ad spending verticals this year, while Finance re-accelerates and Government expands due to the many elections taking place this year.

 

Vincent Létang, EVP, Global Market Research at MAGNA, and author of the report, said:

“Based on MAGNA’s analysis of media companies financial, advertising revenues were much stronger than expected in the first quarter of 2024. Coupled with some improvement in the macro-economic outlook, this leads us to increase our full-year global advertising growth forecast from +7.2% (December 2023 update) to +10%. All categories of media owners are faring better than expected so far this year, including traditional media owners and, specifically, television and premium long-form video. The introduction and rapid development of ad-supported streaming in more markets by nearly all streaming players (now including Prime Video) is driving non-linear TV ad sales by +16% this year, and total TV ad sales by +4%. Non-linear forms of television are finally reaching scale in terms of viewing and advertising monetization.”

The summer update of MAGNA’s “Global Ad Forecast” predicts media owners net advertising revenues (NAR) will reach $927 billion this year, growing +10.0% over 2023. This is a significant acceleration on the global growth recorded in 2023 (+6.4%). Neutralizing the impact of cyclical events in 2023 and 2024, the normalized acceleration is still real but more modest: non-cyclical ad revenues grew by +7.5% in 2023 and will grow by +8.7% in 2024.

A record number of cyclical events are taking place in 2024, including four major sports tournaments (Paris Olympics, UEFA Euro 2024, Copa América hosted by the US, and the ICC T20 Cricket World Cup hosted by the US and the West Indies), and general elections in five major markets (Mexico, India, US, France, and the UK). The first three elections take place in countries with little or no restrictions to political advertising, therefore moving the needle in terms of advertising sales. Overall, the 2024 cyclical events will provide 1.3% extra growth to global ad revenues this year, 5% extra growth for television, 0.5% extra growth for digital media, and almost 2% extra growth for the US market alone.

MEDIA: TMO DIGITAL SALES GROW DOUBLE-DIGITS

MAGNA was always expecting a strong ad market in the first quarter of 2024, due to a comp effect (1Q23 was extremely weak). Based on our analysis of media companies’ first-quarter financial reports, 1Q24 was an even stronger than expected. Year-over-Year growth average +12% in key markets, +17% in Spain, +15% in France, and Germany. Quarterly growth rates will gradually slow as comps become tougher in the second half, but this strong start of the year, coupled with a stronger economic outlook led us to raise the full year 2024 forecast for almost every individual market we monitor, bringing the expected global growth from +6.4% in December, to +10% now. The full-year ad revenues of traditional media owners are now forecast to grow by +3% instead of +2%, and the ad sales of digital pure players are now expected to grow by +13% (previously +9.4%).

Traditional media owners (TMO) historically focusing on Television, Audio, Publishing, OOH, and cinema media, will grow ad revenues by +3% globally in 2024, to reach $272 billion.

TMO’s non-linear ad sales (e.g., ad-supported streaming, digital audio, publishers’ digital ad sales) are now accounting for +25% of total TMO ad revenues and supporting advertising growth while traditional linear ad sales are stagnating. Ad-supported streaming is taking off in 2024, as traditional TV players (e.g. Disney+, Max, ITV Hub, Joyn, TF1+, etc.) and pure streaming players (Netflix, Amazon) will generate at least $18 billion this year (+16%). Amazon has already introduced an ad-supported tier on Prime Video in most large markets in the first half of 2024, including the US, Canada, Mexico, France, Germany, Italy, Spain, and the UK. Everywhere users are defaulted to the new ad-supported tier, and MAGNA believes most users will permanently remain on that tier, rather than upgrade to a more expensive ad-free tier. Other streaming platforms are introducing such ad tiers in more markets (e.g., Max in Latin America in Feb. 2024) while the rising cost of ad-free options makes the ad-supported tiers increasingly attractive.

Cross-platform television remains the largest traditional media with total ad sales reaching $162 billion this year (+4%) as media owners benefit from cyclical events and rapid growth of ad-supported streaming. Publishing ad sales will remain subdued (-3% to $44 billion) while Radio ad sales reach $29 billion (+2%).

After finally catching up with the pre-COVID levels in 2023, OOH media continues to show significant organic growth (+7% to $35 billion) driven by additional screen units generating digital OOH growth (+12%, reaching almost 40% of global OOH ad sales), and by omnichannel programmatic spending.

Digital Pure-Play (DPP) media owners, offering Search/Commerce, Social, Short-Form Video, Static Banners, and Digital Audio ad formats, will reach $655 billion this year, growing by +13% over 2023, and accounting for 71% of total ad sales. DPP ad sales are fueled by multiple organic growth factors including the rise of ecommerce, the rise of retail media networks providing much needed consumer data to the programmatic ecosystem, growing digital penetration in emerging markets, and better monetization of the rapidly growing short vertical video formats in social and video apps.

Keyword Search will remain the largest digital advertising format, reaching the $330 billion milestone driven by Retailer Search (e.g., Amazon and product listing ad retail media, +14% to $126 billion) and Core Search (e.g., Google, Bing, Baidu, +11% to $204 billion). Social Media ad sales (e.g., Meta, TikTok) will grow by 17.5% to $212 billion), while Short-Form Pure-Play Video platforms (e.g., YouTube, Twitch) will expand ad revenues by +14% to $78 billion.

MARKETS: INDIA AND SPAIN AMONG THE MOST DYNAMIC

The economic outlook is the primary factor behind advertising spending decisions, and economic activity is so far stronger than previously expected this year. In its April report, the IMF raised its 2024 GDP growth forecast for the world (from +2.9% to +3.2%), for the US (from +1.5% to +2.7%), for China, India, and Brazil. The forecast was lowered, however, for France and Germany, but as it happens these two markets will benefit from hosting major sports events to support marketing and advertising activity. Meanwhile inflation is slowing down everywhere and expected to hover between +2% and +3% in most large markets, which is still above the long-term target of monetary institutions but low enough to no longer hurt the sales and marketing efforts of CPG/FMCG brands.

Among the most dynamic ad markets this year: Spain (+14%), India and the UK (both +12%), France and the US (both +11%). Germany and China are both experience economic difficulties and slower-than-average advertising spending (both +8%).

In the US, media owners ad revenue will increase by +10.7% to $374 billion. The US remains the largest and most intense ad market in the world with advertisers spending $1,100 per consumer in 2024; it’s 8 times more than the global average ($160), ten times more than China ($110) and a hundred times more than India ($10).

ADVERTISERS: AUTO AND CPG BRANDS OUTPERFORM

Automotive, Food, and Drinks will be among the fastest-growing industry verticals in 2024. Finance/Insurance re-accelerates. Government ad spending explodes due to the many elections taking place this year (India, Mexico, UK, and the US elections expected to generate more than $9 billion of extra ad sales this year)

Automotive brands were very dynamic in 2023 due to the increased levels of competition brought about by the electric transition, and the return of normal supply following the supply chain issues of 2021-2022 that inhibited car sales. After the 2023 rebound, car sales are slowing down in 2024 (Jan-May was still +7% in Europe, but only +2% in the US) but a continued push towards more EV releases, heightened competition (between traditional brands, EV pure players, and now Chinese newcomer brands), and major sports events will fuel above-average marketing and advertising activity this year.

Food and Drink brands were the main victims of the high levels of inflation in 2022 and 2023, as marketers were forced to increase retail prices to meet rising cost, making them increasingly vulnerable to consumer downtrading and retailer brands. Food, Drinks and other CPG/FMCG categories chose to concentrate on retail media at the expense of traditional media during that period. Now that inflation in commodity costs and consumer prices is under control, marketers are comfortable returning to normal levels of brand advertising budgets and taking advantage of the marketing opportunities offered by major sports events, while still developing retail media by re-allocating in-store marketing budgets to support ecommerce.

Among industry verticals expected to be dynamic, Finance/Insurance is strong as the industry is finally recovering from several headwinds in recent years: COVID, the Crypto rise and burst (and now rising again), and high interest rates that hurt segments like mortgages, loans, and credit cards.

The Retail industry will show moderate advertising activity overall, as an average between traditional brick-and-mortar brands slowing down from mature levels of marketing spending, and new ecommerce brands like Temu and Shein developing their share of voice aggressively.

MAGNA is expecting below-average advertising growth from several large verticals. Technology and Telecoms will continue to show subdued marketing and advertising activity as tech innovation slows down and tech brands focus on profitability rather than growth. Media/Entertainment brands also focus on the bottom line and have fewer-than-usual new movies and shows to advertise in 2024 due to the 6 months hiatus in Hollywood production in 2023. Finally, after a spectacular post-COVID rebound in 2021-2023, the Travel industry is slowing down this year, and so will the pace advertising spending. Some segments are still growing however, including business travel and cruise ships, with additional capacities to fill in 2024.

MEDIA OWNERS: DIGITAL CONCENTRATION GROWS AGAIN

The MAGNA report also provides estimates on media owners ad revenues, based on media companies’ financial reports. It reveals that global media vendor concentration grew again in 2023. After stagnating in 2022 and the first half of 2023, the global advertising sales of digital media giants re-accelerated in the second half of 2023. The main factor behind the revenue slowdown between mid-2022 and mid-2023 was the rapid rise of short vertical videos in social and video apps, and the weaker advertising monetization that initially ensued for vendors like Meta and YouTube. Monetization finally improved from 3Q23, and quarterly growth rates have been strong for all major vendors ever since.

Full-year 2023, Google, Meta, and Amazon organic ad revenues increased by +6%, +16% and +24% respectively. The big three now attract a combined 60% of total advertising revenues outside China ($417 billion out of $698 billion), up from 57% in 2021-2022. Including China – where they don’t operate – they control 49% of global ad sales.

Among the world’s top 20 vendors, Amazon (+24%), Bytedance/TikTok (+18%) and Apple (+23%) posted the strongest growth in advertising revenues in 2023 while most traditional media companies reported declines in global ad sales: Comcast (-16%), Disney (-9%), Warner (-12%) and RTL (-4%). JCDecaux was the only top traditional media owner to grow ad sales in 2023 (+3%).

In the first quarter of 2024, the leading global digital vendors reported the strongest growth rates in more than two years. Based on MAGNA’s analysis of financial report, global Search ad sales grew by +16% year-over-year, pure-play video by +21% and Social Media by +28% year-over-year. Quarterly growth rates are bound to slow down as comps will gradually get tougher, but MAGNA anticipates double-digit growth for all key digital formats and vendors this year.

FOCUS ON THE US

Media owners advertising revenues are forecast to reach an all-time high of $374 billion this year, growing +10.7% over 2023. This is 1.5 percentage points above our previous full-year forecast (+9.2% in our March 2024 update), following a stronger-than-expected start of the year (+12% in the first quarter) and an improvement in the macro-economic outlook – with the latest GDP growth forecasts raised to a robust +2.5%. The macro-economic factor offsets slightly lower cyclical expectations, as our political advertising forecast is reduced following by weaker-than-expected fundraising in the first few months of the year. We still expect the 2024 election campaigns to generate $9 billion dollars of incremental advertising revenues for US media owners this year, an increase of +10% vs 2020.

The +11% increase in ad spend will disproportionately benefit digital pure players this year (+13.5% to $263bn), with Search and Retail media ad revenues growing +13%, Social Media and Short-Form digital video up +16%.

Traditional media owners ad revenues will reach $111 billion (+4.4%). Non-cyclical revenues, however, will shrink by -2%. Local TV will capture more than 60% of the $9 billion of incremental ad sales driven by political advertising, directly through campaign spending at high media rates, and indirectly through the airtime cost inflation caused by the extra demand in battleground states. Full year ad revenue will grow by +25% for local TV stations and local cable, while non-political ad sales would be down by -4% this year. Other traditional media will not benefit from such a massive boost. National TV, Audio Media, and Publishing will be flat or down this year, and OOH will be the only other traditional media to grow ad revenues.

KEY FIGURES

TABLE 1: US AD FORECAST

Source: MAGNA US Ad Forecast June 2024. Growth rates are excluding cyclical unless otherwise mentioned.
PREV= March 2024 report.

TABLE 2: INDUSTRY VERTICALS

GLOBAL AD SPENDING DYNAMIC 2024

Source: MAGNA Global Ad Forecasts, June 2024.

TABLE 3: GLOBAL AD FORECAST FOR 2024

Source: MAGNA Global Ad Forecasts, June 2024. Growth rates include cyclical ad spend. The ad revenues of TMO include digital ad sales. All amounts in constant US dollar. “PREV” = Previous MAGNA forecast report (December 2023).

ABOUT THE RESEARCH

The MAGNA market research is media centric. It estimates net media owners advertising revenues based on an analysis of financial reports and data from local trade organizations; other ad market studies are based on tracking ad insertions or consolidating agency billings. The MAGNA approach provides the most accurate and comprehensive picture of the market as it captures total net media owners’ ad revenues coming from national consumer brands’ spending as well as small, local, “direct” advertisers. Forecasts are based on economic outlook and market shares dynamic. The full Ad Forecast report (80 pages) and dataset contains more granular media breakdowns and forecasts to 2028, for 70 markets.

ABOUT MAGNA

MAGNA is the leading global media investment and intelligence company. Our trusted insights, proprietary trials offerings, industry-leading negotiation and unparalleled consultative solutions deliver an actionable marketplace advantage for our clients and subscribers. We are a team of experts driven by results, integrity, and inquisitiveness. We operate across five key competencies, supporting clients and cross-functional teams through partnership, education, accountability, connectivity, and enablement. For more information, please visit our website: https://magnaglobal.com/and follow us on LinkedIn.

MAGNA has set the industry standard for more than 60 years by predicting the future of media value. We publish more than 50 reports per year on media and advertising market trends. To access full reports and databases or to learn more about our market research services, contact [email protected].

Press Contact:

Suzette Meade, IPG Mediabrands
[email protected]

The media holding company’s marquee assessment expands to cover fast-growing Programmatic space along with Social Media platforms

New York, NY – [June 14, 2024] – Today IPG Mediabrands and its media investment and intelligence unit, MAGNA, released The Media Responsibility Index (MRI), marking the 5th edition of this proprietary assessment of global media platforms. For the first time, programmatic companies were added to the suite of partners included, building on the previous work with social media platforms.

The MRI was launched in 2020 at a pivotal moment for social media platforms, when there was increased concern about harmful content and distinguishing fact from misinformation. Amidst the urgent calls for greater transparency on content and brand and user safety, the MRI, spearheaded by the holding company’s impact investment team, emerged as an influencer of industry collaboration and barometer of progress. 

“We have seized the opportunity to further our Media for Good efforts, which are focused on making a positive impact within and beyond our holding company, by introducing an impactful, robust assessment that helps to create a culture of accountability and transparency in the media landscape,” said Eli Harris, EVP of Impact Investment at IPG Mediabrands. “With each new report we have seen the measurable impact of the work we do together with our media and industry partners, all of whom are committed to this shared goal of media responsibility.”
 

In 2023, global display programmatic advertising accounted for more than 70% of total display and video revenues, and grew by +10% over 2022, according to MAGNA’s “Programmatic Intelligence Report” (Oct. 2023). There is increased complexity in the programmatic ecosystem with demand side platforms (DSP), supply side platforms (SSP), publishers, and advertisers. The inclusion of programmatic in the MRI 5.0 was a natural evolution for the 2024 report.
 

MRI 5.0 revealed that the industry had a small 6-point gap between average platform performance and the top performing DSP, or benchmark. This reflected a high-level of consistency in the approach to the priority areas measured, in particular safety and data ethics. The data was promising as it indicated that DSPs were early to adopt the use of tools, e.g., pre-bid verification technologies, to deliver brand safety and suitability in the areas MRI is focused on. The competitive landscape and efforts at holding platforms accountable likely have been motivating factors for action and transparency around inventory, as DSPs have sought to differentiate their offerings for advertisers.
 

Programmatic Recommendations 

Based on the MRI 5.0 findings, programmatic platforms could push their media responsibility efforts even further through the following steps: 

• • Go beyond basic measures to avoid made-for-advertising (MFA) inventory, such as classifications.
     

• • Achieve industry alignment on a standardized definition of what MFA sites are.
      

• • Act on removing all advertising that runs across MFA sites, as currently only some SSPs do this automatically.
     

• • Improve communication to advertisers to raise awareness of safety measures like categorization and opt-out.
     

Progress by Social Platforms

Over the past five years, we have seen steady performance improvements, where the social platforms average score has increased by 21-points between MRI 1.0 and MRI 5.0. In the first MRI there was a 16% difference between the group average and the benchmark, and through ongoing education on media responsibility expectations, industry advancements, and their individual platform progress by the Impact Investment Team, that gap was reduced to 5% in MRI 5.0. 

In 2024, with an ever-changing technology, regulatory, and geopolitical climate that can impact brands’ advertising strategies and media investments, the MRI has broached into new topics to stay abreast of emerging threats to advertisers and their audiences. The intent is to ensure that advertisers are better informed and have actionable intelligence to advocate for features and solutions that will lead to a more responsible media ecosystem for all.  

How Advertisers Can Influence Media Responsibility

Brands have a tremendous opportunity to connect with their audiences through social media and build trust. A recent study called “Brand Trust Dimensions” found that the majority of people surveyed (76%) said responsible advertising practices, e.g., paying attention to what content ads run next to and creating inclusive ads, was the most effective way a brand can build trust with customers.  

• • Advertisers can lead the charge on improving safety standards for emerging threats.
     

• • With a heavy Gen Z presence on social media, and Gen Alpha quickly coming of age, advertisers could encourage platforms to design specific young user experiences, given these exist sparingly today.
     

• • Advocate for mental health and wellbeing, and combat misinformation, by calling on platforms to verify the accuracy and safety of information shared in online mental health communities.
     

• • Moderators are a key element of building responsible media practices, and advertisers could encourage social platforms to publish diversity statistics on their human moderators in an effort to ensure inclusive representation and best reflect the audiences engaged.
     

• • Climate misinformation is the trickiest type of content to identify, yet some platforms still don’t have a policy to demonetize climate mis/disinformation or greenwashing policies. Overall, advertisers have an opportunity to encourage platforms to consider sustainability best practices in their media responsibility efforts.
     

To learn more about The Media Responsibility Index, please visit https://magnaglobal.com/MRI. 

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About IPG Mediabrands
IPG Mediabrands is the media and marketing solutions division of Interpublic Group (NYSE: IPG). IPG Mediabrands manages over $47 billion in marketing investment globally on behalf of its clients across its full-service agency networks UM, Initiative and Mediahub and through its award-winning specialized business units Healix, KINESSO, MAGNA, Mediabrands Content Studio, Orion Holdings, Rapport, and the IPG Media Lab. IPG Mediabrands clients include many of the world’s most recognizable and iconic brands from a broad portfolio of industry sectors including automotive, personal finance, consumer product goods (CPG), pharma, health and wellness, entertainment, financial services, energy, toys and gaming, direct to consumer and e-commerce, retail, hospitality, food and beverage, fashion and beauty. The company employs more than 18,000 diverse marketing communication professionals in more than 130 countries.  

Learn more at www.ipgmediabrands.com.
 

About MAGNA
MAGNA is the leading global media investment and intelligence company. Our trusted insights, proprietary trials offerings, industry-leading negotiation and unparalleled consultative solutions deliver an actionable marketplace advantage for our clients and subscribers. 

We are a team of experts driven by results, integrity, and inquisitiveness. We operate across five key competencies, supporting clients and cross-functional teams through partnership, education, accountability, connectivity, and enablement. For more information, please visit our website: https://magnaglobal.com/ and follow us on LinkedIn.
 

Press Contact:
Suzette Meade
IPG Mediabrands
[email protected]  

MAGNA Media Trials and Uber research shows high ad receptiveness and engagement among rideshare passengers

NEW YORK, NY, June 12, 2024 – MAGNA Media Trials released a research study, “Inside a Rideshare: The Tablet Ads Opportunity,” in partnership with Uber today. The report explores the effectiveness of tablet ads and indicates that there is a significant opportunity for advertisers to create memorable and impactful experiences for rideshare passengers.  As the rideshare tablet market expands and is expected to grow to $1.3 billion (139%) by 2032, according to Market Research Future, advertisers can leverage this platform to connect with an engaged audience and make a lasting impression.

The study reveals that the rideshare environment is ideal for ad receptiveness. Most rideshare passengers are frequently in a positive mood, and regardless of a positive (94%) or neutral mood (88%), they are very or somewhat open to viewing ads during their journey.

“Our JourneyTV tablet format is extremely effective because they capture the attention of Uber’s highly engaged audiences at a time when they’re tuned-in and receptive,” said Dorothy Ann Advincula, Global Lead of Audience, Insights and Measurement at Uber advertising division. “This research confirms what we see in our own proprietary insights, that riders are ready to not only interact with ads during their rides, but can even find them to be value-add in their journey.”

Rideshare tablets deliver a win-win for both the rider and advertiser. Beyond ad receptivity, 66% of riders find the idea of ads entertaining during their ride, while 54% believe it would enhance their overall experience. The study reveals that a significant number of riders perceive ads as a value-add to their journey (69%).

Throughout the rideshare journey, the study proves that tablet ads cut through the noise of everyday life, such as checking trip details in the app (85%) and talking with others (82%).

Key Research Findings:

• When riding solo, riders are most highly receptive to ads, with 84% showing openness. Even when co-riding, whether with someone they know (77%) or someone they don’t know (75%), there is a strong willingness to engage with ads.
• Riders have a keen interest in entertainment (87%), food & drink (84%), travel (81%), and retail and shopping (80%) ads.
• 74% of riders are interested in availing coupons during their Uber ride, and 49% would use a coupon relevant to their future needs.
• 41% of riders pay the most attention to ads that are creative and visually clear.

 

“In this study, we gained a thorough understanding of rideshare passengers: their mood, motivation, perception, and what it takes to capture their attention during their rides,” said Kara Manatt, EVP of Intelligence Solutions at MAGNA. “As advertisers continue to explore the rideshare tablet market, this study is bound to serve as the foundation for their success.”

To read the full study by MAGNA Media Trials and Uber, please visit the MAGNA website and click the link here .

 

About MAGNA

MAGNA is the leading global media investment and intelligence company, and part of the IPG Mediabrands network. Our trusted insights, proprietary trials offerings, industry-leading negotiation and unparalleled consultative solutions deliver an actionable marketplace advantage for our clients and subscribers. We are a team of experts driven by results, integrity, and inquisitiveness. We operate across five key competencies, supporting clients and cross-functional teams through partnership, education, accountability, connectivity, and enablement. For more information, please visit our website: https://magnaglobal.com/and follow us on LinkedIn.

About Uber

Uber’s mission is to create opportunity through movement. We started in 2010 to solve a simple problem: how do you get access to a ride at the touch of a button? More than 49 billion trips later, we’re building products to get people closer to where they want to be. By changing how people, food, and things move through cities, Uber is a platform that opens up the world to new possibilities.

Media Contacts:
Suzette Meade
IPG Mediabrands / MAGNA
[email protected]

Jazmin Brooks
IPG Mediabrands / MAGNA
[email protected]